Update to issue of equity

 

TIDMSAM 
 
RNS Number : 5957S 
Syndicate Asset Management PLC 
20 May 2009 
 

For immediate release: 
 
 
Syndicate Asset Management plc 
("Syndicate", "the Company" or "the Group") 
Re: Issue of Equity update 
 
 
Syndicate Asset Management plc (AIM:SAM), the fund management group with 
approximately GBP5.9 billion under management, refers to its Issue of Equity 
announcement of 8 May 2009 (the "Announcement"). 
 
 
In the Announcement, the Company stated that it had reached agreement in 
principle to settle GBP2.0 million of deferred consideration owed to certain 
vendors (or their assignees) (the "Vendors") in respect of businesses previously 
acquired by the Group. Under the terms of the agreement, the Company would agree 
to issue 200 million new ordinary shares of 0.2p each ("Ordinary Shares") 
("Deferred Consideration Shares") to the Vendors in payment of deferred 
consideration owing to the Vendors and in consideration for the Vendors agreeing 
to an 18 month standstill such that they will not receive any payments in cash 
from the Group for 18 months following the admission of the Deferred 
Consideration Shares to trading on AIM becoming effective. The Company announces 
that final agreement has now been reached with the Vendors and final 
,documentation, which is in agreed form, is expected to be signed prior to the 
26 May 2009. The issue of the Deferred Consideration Shares will be conditional 
upon, inter alia, shareholder approval, which is to be sought at a general 
meeting of shareholders to be held on 26 May 2009 ("General Meeting"). The 
Deferred Consideration Shares have been conditionally placed by Cenkos 
Securities with certain institutional investors at a price of 1p per Deferred 
Consideration Share. 
 
 
In the Announcement, the Company also referred to the conditional subscription 
(the "Subscription") by existing shareholders and employees of the Group, for 
310,000,000 new Ordinary Shares (the "Subscription Shares"). The Company stated 
that the Subscription by one of those existing shareholders, who fall within the 
definition of related parties in the AIM Rules because they hold 10 per cent. or 
more of the Company's existing Ordinary Shares, was deemed to be a related party 
transaction. Pursuant to Rule 13 of the AIM Rules, the Company announces that Al 
Bateen Investment Company LLC ("Al Bateen") is a related party by virtue of it 
owning approximately 25.4 per cent. of the Company's current issued share 
capital. Pursuant to the Subscription, Al Bateen has agreed to subscribe for 
129,540,000 shares. Following the passing of the resolutions at the General 
Meeting and admission of the Subscription Shares and the Deferred Consideration 
Shares, Al Bateen will hold 164,491,613 Ordinary Shares, representing 25.4 per 
cent. of the Company's enlarged issued share capital. 
 
 
Having consulted with the Company's advisers, directors David Pinckney, Peter 
Dew and Jane Dumeresque have now elected not to subscribe for any Subscription 
Shares. As a result, their holdings will remain 650,000, 100,000 and 
95,026 respectively which, following admission to AIM of the Subscription Shares 
and Consideration Shares would represent 0.1, 0.02 and 0.01 per cent 
respectively of the Company's enlarged share capital. 
 
 
The Board has, at all times, sought to protect the interests of Shareholders as 
a whole by undertaking actions designed to avoid a breach of the Company's 
banking covenants, whilst having to operate within the parameters set by RBS. At 
the same time, the Board has been mindful of the fact that the solution that it 
is proposing requires the approval of Shareholders at the General Meeting and 
also of the Vendors. The Board has considered a number of alternative solutions 
including having met with parties who have made preliminary approaches either in 
relation to the acquisition of all or some of the Company's issued share 
capital, or to making a strategic investment in the Company. Having considered 
these alternatives in detail, which it should be emphasised were very 
preliminary in nature, the Board has concluded that they provide little or no 
certainty and/or are undeliverable in the timeframe required, if at all, and 
that, accordingly, they should be rejected in favour of the Subscription and the 
issue of the Deferred Consideration Shares. The Board continues to believe that 
the proposal as set out in the announcement of 8 May 2009 is in the best 
interests of Shareholders taken as a whole. 
 
 
 
 
 
 
David Pinckney, Chairman of Syndicate, commented: 
"Whilst we can understand the concerns raised by certain Shareholders, the Board 
is committed to pursuing a strategy that is both in the long term interest of 
the Company's Shareholders, clients, staff and which meets the demanding 
financial parameters and time constraints set by the bank." 
 
 
- ends - 
 
 
For further information: 
 
 
Syndicate Asset Management plc 
David Pinckney     (Chairman) Tel: [phone] 
Jonathan Freeman     (Interim Joint CEO) 
Peter Dew     (Interim Joint CEO) 
 
 
Cenkos Securities 
Stephen Keys                                                    Tel: [phone] 
8900 
 
 
GTH Communications 
Toby Hall/Christian Pickel                                              Tel: 020 
7153 8039 
 
 
 
This information is provided by RNS 
            The company news service from the London Stock Exchange 
   END 
 
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