Scotty Group SE Trading Update & Financing Proposal (7208L)

TIDMSCO

RNS Number : 7208L

Scotty Group SE

07 September 2012

7 September 2012

SCOTTY Group SE

("SCOTTY" or the "Company")

Trading Update and Financing Proposal

The board of SCOTTY announces a trading update and financing proposal.

On 10 May 2012, the board reported that negotiations with key customers for delivery of contracts had been progressing satisfactorily but continued to be subject to delays as a result of which revenues in the first half had fallen short of management's expectations. The board now reports that these delays have persisted, in particular with Eurocopter, which has had an adverse effect on the Company's working capital position, such that there is now an urgent need for additional finance which the board has been unable to effect through regular bank financing.

The board is seeking to raise a minimum of Euros 350,000, on terms to be determined, due for completion on 24 September 2012. Directors and related parties have indicated their willingness in principle to provide the minimum funds. However, the terms and conditions have not yet been agreed.

In accordance with the Company's Austrian Statutes, the Company is required to offer all shareholders the right to participate pro rata their existing shareholdings in any fundraising. However, this requirement can be waived in certain circumstances, as is the case currently where the Company has an urgent need for additional working capital. In order to do this, a notice must be published in the Wiener Zeitung 14 days prior to the fundraising taking place. Set out below this announcement is a synopsis of the notice being published in the Wiener Zeitung today.

A further announcement relating to the proposed financing will be made in due course. The Company intends to announce its interim results for the 6 months to 30 June 2012 during the week commencing 10 September 2012.

Enquiries:

 
 SCOTTY Group SE 
  Kurt Kerschat, CEO                    [phone] 
 Nominated Adviser 
  Cairn Financial Advisers LLP 
  Tony Rawlinson / Avi Robinson         [phone] 
 Broker 
  Northland Capital Partners Limited 
  John Howes                            [phone] 
 

Synopsis of the notice published in the Wiener Zeitung on 7 September 2012 entitled:

Report by the Board of Directors of the Scotty Group SE, FN 377850m in accordance with section 63 (1) SEG in connection with section 170 sub-section 2 and section 153 sub-section 4 AktG (Austrian Stock Companies Act)

1. At the Annual General Meeting (AGM) of Scotty Group PLC on 28 June 2011, the board was authorised (in accordance with English law) to disapply pre-emption rights in respect of up to 65% of the issued share capital of the Company at the time. At the General Meeting of the Company on 27 September 2011, the legal form of the Company was changed from a UK public limited company into a European Societas Europaea (SE) and the Company's name was changed to Scotty Group SE. As part of the Company's redomicile to Austria, the previously approved authority to disapply pre-emption rights was amended to comply with Austrian law. On 7 December 2011, a notice of General Meeting was published proposing an increase in the Company's share capital by the issue of a further Euros 484,820 of new shares and such proposal was approved at the General Meeting held on 30 December 2011. This authority permitted the Company to disapply pre-emption rights for any capital increase if the directors believed this to be in the best interests of the Company. The redomicile of the Company to Austria and adoption of new Statutes was entered in the commercial register of the Regional Court of Eisenstadt with the resolution of the Regional Court of Eisenstadt on 17 April 2012.

2. The Board of Directors of the Company now intends to increase the share capital of the Company under the authority approved at the General Meeting on 30 December 2011 through the issue of up to EUR 484,820 of new ordinary shares to rank pari passu with the existing ordinary shares in the Company. For the reasons set out below, shareholders pre-emption rights will be disapplied.

3. The directors believe it to be in the best interests of the Company for shareholders pre-emption rights to be disapplied for the following reasons:

3.1 Delays in order processing by a major customer have resulted in an urgent need for additional working capital which the board has been unable to raise through its bank facilities. The board of the Company has explored the possibility of raising this funding by offering all shareholders the opportunity to participate but, in view of the time and costs involved and the urgency of this financing requirement, the board has decided to set aside pre-emption rights in this case.

3.2 The board estimates that a sum of EUR 350,000 will need to be raised to satisfy its working capital requirements. Terms and conditions of such financing are to be determined in negotiation with placees. The issue price cannot be less than the par value of the Company's shares which is Euro 1.

4. The directors aim to close the fundraising on 21 September 2012 and complete it on 24 September 2012, at which time the enlarged share capital will be determined based on a subscription price of between 1.00 and 1.20 Euros per share and any other terms and conditions relating to the financing.

The Board of Directors

Eisenstadt, 7 September 2012

This information is provided by RNS

The company news service from the London Stock Exchange

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