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Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
---|---|---|---|---|---|
Tandem Group Plc | LSE:TND | London | Ordinary Share | GB00B460T373 | ORD 25P |
Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|---|---|
0.00 | 0.00% | 165.00 | 160.00 | 170.00 | 165.00 | 165.00 | 165.00 | 180 | 08:00:00 |
Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
---|---|---|---|---|---|
Motorcycles,bicycles & Parts | 22.24M | -1.24M | -0.2261 | -7.30 | 9.03M |
RNS Number:8071H Tandem Group PLC 21 February 2003 21 February 2003 For immediate release NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION IN OR INTO CANADA, AUSTRALIA OR JAPAN Tandem Group plc Circular posted to convene an EGM to facilitate the Recommended Offer for the acquisition of MV Sports Group plc by Tandem Group plc and other matters Definitions used in this announcement are set out in the text below or in the appendix at the end. Further to an announcement made on 3 February 2003 in relation to the recommended offer ("Offer") by Tandem to acquire the entire issued and to be issued share capital of MV Sports by way of the Scheme, the board of Tandem has called an extraordinary general meeting ("EGM") of the Company to be held at the offices of Eversheds Solicitors, 115 Colmore Row, Birmingham B3 3AL at 11.30 a.m. on 18 March 2003. Details of the matters to be considered at the meeting are contained within a circular to Tandem Shareholders which is being posted today (the "Circular"). Copies of the Circular, and of the Scheme document, are available free of charge from the Company Secretary, Tandem Group plc, 9a South Street, Crowland, Peterborough, PE6 0AH. At the meeting, resolutions will be put to shareholders to: * Increase Tandem's authorised share capital, to grant the Directors authority to allot relevant securities and to disapply pre-emption rights to facilitate, inter alia, the acquisition of MV Sports; * Approve the Share Capital Reorganisation involving a reduction of share capital and a consolidation, sub-division and conversion of Ordinary Shares; and * Approve the purchase by the Company of its own "A" Ordinary Shares. Increase in authorised share capital and authority to allot relevant securities and disapplication of pre-emption rights to facilitate the acquisition of MV Sports As already described in the announcement of 3 February 2003, the Scheme provides for the allotment of up to 12,168,403 New Ordinary Shares (being equivalent to 121,684,058 Ordinary Shares before the Share Capital Reorganisation (see below) has been effected) to MV Sports Scheme Shareholders. In order for the Company to proceed with the Acquisition and the Scheme, it is therefore necessary to increase its authorised share capital and for the Directors to be authorised to allot sufficient relevant securities under section 80 of the Companies Act. The Directors do not have the requisite power to allot relevant securities without Shareholder authority pursuant to section 80 of the Companies Act. If the power to allot is authorised, the Directors intend to exercise their authority to allot shares for the purpose of the Acquisition and the Scheme. A resolution is also being proposed at the EGM to disapply statutory pre-emption rights in connection with, inter alia, the proposed issue of shares pursuant to the Scheme. Capital Reorganisation involving reduction of share capital and consolidation, sub-division and conversion of Ordinary Shares The middle market price of an Ordinary Share as at the close of business on 31 January 2003, being the latest practicable date prior to the Offer being announced, was 3.5p. Typical bid/offer spreads, the price at which market makers are willing to buy and sell shares tend to be +/- 0.25p above and below the middle market price. Although it is sometimes possible to buy Ordinary Shares within the bid/offer spread, taking into account typical dealing costs and stamp duty most investors buying Ordinary Shares would typically have to see the share price rise by 0.5p before they can realise a profit on their purchase. The Directors are advised by the Company's Broker that having such a low share price is not attractive to some institutional investors. The Directors consider that raising the attractiveness of the Company to a larger group of potential investors, while retaining the Company's attractiveness to the private investor, is important to facilitate the growth of the Company and its profile. Accordingly, the Directors have decided to recommend to Shareholders that the Ordinary Shares are consolidated on a 1 for 10 basis and a resolution to effect this is set out in the Notice of EGM contained in the Circular. Upon completion of the consolidation, Shareholders will hold 1 New Ordinary Share for every 10 Ordinary Shares that they currently hold. This should mean that the Company's New Ordinary Shares will trade at approximately 10 times the value at which they currently trade, although market forces may mean that the price is greater than or less than this anticipated value. The nominal value of each Ordinary Share is currently 4p. The middle market price of each Ordinary Share in recent weeks has been less than that amount and was 2.75p as at 20 February 2003 being the latest practicable date prior to the printing of the Circular. Upon completion of the consolidation referred to above, the Directors would expect the margin between nominal value and market price to remain small. A company limited by shares has no power to issue shares as fully paid up for a consideration which is less than their nominal value and is prohibited from doing so under section 100 of the Companies Act. For this reason and in order to give the Company greater flexibility in pricing equity fund raisings, it is proposed that the Share Capital Reorganisation be structured so that the nominal value of the Company's resulting Ordinary Shares shall have a par value of 4p each thereby increasing the margin between nominal value and market price. In order to effect this, New "B" Ordinary Shares will be created and then cancelled as follows: (i) every 10 existing issued and unissued ordinary shares of 4p each will be consolidated into one ordinary share of 40p each; (ii) every resulting ordinary share of 40p each will be sub-divided and converted into 1 New Ordinary Share of 4p each and 1 non-voting cancellable "B" ordinary share of 36p each; and (iii) subject to Court and Shareholder approval, all of the non-voting cancellable "B" ordinary shares of 36p each will be cancelled. Despite the creation of New "B" Ordinary Shares and changes to the underlying par value of the resulting New Ordinary Shares, Shareholders can rest assured that their percentage ownership of the Company will not change as a result of the Share Capital Reorganisation except as a result of fractional entitlements and the issue of the Consideration Shares in respect of the Acquisition. Therefore, a shareholder holding, say, 1 per cent of the voting Ordinary Shares of the Company today, would hold materially the same percentage immediately after the proposed Share Capital Reorganisation (were the Acquisition not to take place). The rights attached to the New Ordinary Shares will be the same as those attached to the existing Ordinary Shares in the capital of the Company and an application will be made for the New Ordinary Shares to be listed on AIM. Any fractions of the New Ordinary Shares to which shareholders would otherwise be entitled upon the Share Capital Reorganisation becoming effective will be aggregated and sold and the proceeds shall be retained by the Company for its benefit. The New "B" Ordinary Shares will be non-voting, will have very limited rights to dividends or on a return of capital, will be subject to buyback by the Company at a purchase price of 0.001p per share and will be cancellable. It is anticipated that the "B" Ordinary Shares will have negligible value and will, subject to Court and Shareholder approval, be cancelled. The New "B" Ordinary Shares will not be listed on the Official List or AIM. The proposed cancellation of New "B" Ordinary Shares would, if approved, result in a reduction of share capital of #9,137,594.88. In the balance sheet of the Company, an equivalent sum will be credited to a special undistributable reserve. The Company will seek the approval of the Court to use part of this special reserve (a) to eliminate the deficit on the Company's profit and loss account, and (b) to create a surplus to enable the Company to proceed with the proposed Buyback. The proposed Capital Reduction requires the approval of the Shareholders and accordingly the Notice of EGM seeks this approval. The proposed Capital Reduction will also require the Company to apply to the Court to seek an order confirming the Capital Reduction. The Company intends to apply to the Court to seek an order confirming the Capital Reduction. The Court will require to be satisfied that the interests of the Company's creditors will not be prejudiced as a result of the Capital Reduction. It is for the Court, finally, to decide the precise nature of protection required for the Company's creditors and the Board will give such undertakings or other protection as the Court requires and the Board is advised is appropriate. It is anticipated that the Capital Reduction will take place on or around 8 April 2003. Apart from the Buyback (described below), the proposed Capital Reduction will not involve any distribution or repayment of capital by the Company. The Capital Reduction will not materially reduce the underlying net assets of the Company and the Directors do not anticipate that it will adversely affect the market value of the Company's share capital. The principal effect of the Capital Reduction will be to enable the Company to be put into a position where it can purchase its own shares and/or pay dividends out of distributable profits sooner than it would otherwise be able to do. In respect of the New Ordinary Shares, new share certificates will be issued following the Share Capital Reorganisation (if approved). Any share certificates representing current holdings of Ordinary Shares will, following completion of the Share Capital Reorganisation, be cancelled. As before, New Ordinary Shares may be held through the uncertificated CREST system. If the Court approves the cancellation of the New "B" Ordinary Shares, no share certificates will be issued in respect of those shares. Purchase of own "A" Ordinary Shares and Notice to "A" Ordinary Shareholders There are currently 125,000,000 "A" Ordinary Shares in the authorised share capital of the Company, 102,125,309 of which are issued and fully paid. In order to simplify the share capital structure of the Company and in order to save administrative expense currently incurred in relation to the "A" Ordinary Shares, it is proposed that the Company will buy back all of the "A" Ordinary Shares at 0.001p per share (the "Purchase Price"). The "A" Ordinary Shares currently have no right to receive notice of, nor any right to attend and vote at, any general meeting of the Company but do have the right to receive a proportional share of dividends (if declared) and a proportional share of surplus assets on any winding up in each case based on the amount paid up in respect of each "A" Ordinary Share as a proportion of the entire issued share capital. It is proposed that the Company will purchase all of the "A" Ordinary Shares at the Purchase Price. The "A" Ordinary Shares are not listed on AIM and therefore the proposed Buyback is therefore an "off-market" purchase pursuant to section 164 of the Companies Act. Pursuant to section 168 of the Companies Act, the Company will only be able to proceed with the Buyback if, inter alia, it is able to purchase the "A" Ordinary Shares from distributable profits. It is anticipated that if the Capital Reduction is approved, the Company will have sufficient distributable profits. Application for Admission of New Ordinary Shares to trading on AIM If the Share Capital Reorganisation is approved, an application will be made for up to 25,382,208 New Ordinary Shares to be admitted to trading on AIM. Admission of the New Ordinary Shares is expected to be effective on 19 March 2003. If the Scheme is effected an application will be made in respect of the Consideration Shares to be admitted to trading on AIM. If the Share Capital Reorganisation is approved then application will be made for up to 12,168,405 New Ordinary Shares to be issued in consideration of the Acquisition. If the Share Capital Reorganisation is not approved then application will be made for up to 121,684,058 Ordinary Shares to be issued in consideration of the Acquisition. Admission of the Consideration Shares is expected to be effective on 9 April 2003. Update regarding compost claim As announced on 3 February 2003, Tandem is currently defending a claim by a former customer in relation to compost supplied between 1994 and 1995 by a Tandem subsidiary during its ownership of a horticultural business. Tandem was unsuccessful on liability at trial and has, on 19 February 2003, been refused leave to appeal the original trial decision. Nevertheless the matter continues to be vigorously defended and quantum is still to be determined. Currently there is evidence to suggest that quantum could be between #80,000 and #215,000 (plus interest and costs but less any allowance for mitigation), but this is by no means fixed since arguments on quantum have yet to be presented and determined. Tandem has a long-standing provision, of which #72,000 remains, in respect of this litigation. Expected Timetable of Principal Events Extraordinary General Meeting 11.30 a.m. 18 March 2003 Record date of the Share Capital Reorganisation 18 March 2003 Admission of New Ordinary Shares to trading on AIM 19 March 2003 Crest accounts credited with New Ordinary Shares 19 March 2003 Share certificates issued in respect of New Ordinary Shares 21 March 2003 Court hearing of petition to confirm Capital Reduction 7 April 2003 Court hearing of petition to sanction the Scheme 7 April 2003 Effective date of the Capital Reduction 8 April 2003 Completion of the Acquisition 8 April 2003 Admission of Consideration Shares to trading on AIM 9 April 2003 Crest accounts credited with Consideration Shares 9 April 2003 Share certificates issued in respect of Consideration Shares 11 April 2003 Enquiries: Mervyn Keene, Director, Tandem Group plc 01733 211399 Adam Hart, KBC Peel Hunt 020 7418 8900 KBC Peel Hunt, which is regulated in the United Kingdom for the conduct of investment business by the Financial Services Authority, is acting for Tandem and no one else in connection with the Proposals and will not be responsible to anyone other than Tandem for providing the protections afforded to customers of KBC Peel Hunt nor for providing advice in relation to the Proposals, this announcement or any other matters referred to herein. This announcement does not constitute an offer to sell or invitation to purchase any securities or the solicitation of any vote or approval in any jurisdiction. The release, publication or distribution of this announcement in certain jurisdictions may be restricted by law and therefore persons in such jurisdictions into which this announcement is released, published or distributed should inform themselves about and observe such restrictions. The Offer will not be made directly or indirectly in or into or by the use of the mails of, or any other means or instrumentality of interstate or foreign commerce of, or any facility of a national securities exchange of Canada, Australia or Japan. Accordingly, this document is not being, and must not be issued, mailed or otherwise distributed or sent in, into or from Canada, Australia or Japan and persons receiving this document (including custodians, nominees and trustees) must not distribute or send it in, into or from Canada, Australia or Japan. The Tandem Consideration Shares, if approved, will not be registered under the Securities Act or under any relevant securities laws of the United States, nor have the relevant clearances been, nor will they be, obtained from the securities commission or similar authority of any province or territory of Canada, and no prospectus has been or will be filed, or registration made, under any securities law of any province or territory of Canada, nor has a prospectus in relation to the Tandem Consideration Shares, been, nor will one be, lodged with or registered by the Australian Securities and Investments Commission nor have any steps been taken, nor will any steps be taken, to enable the Tandem Consideration Shares to be offered in compliance with applicable securities laws of Japan, nor will the offer of Tandem Consideration Shares be registered with the Securities and Futures Commission of the Republic of China pursuant to relevant securities laws and regulations. Accordingly, unless an exception under the Securities Act or such securities laws is available, none of the Tandem Consideration Shares may be offered, sold, resold or delivered, directly or indirectly, in, into or from the United States, Canada, Australia or Japan or any other jurisdiction in which an offer of Tandem Consideration Shares would constitute a violation of relevant laws or require registration thereof, or to or for the account or benefit of any US Person or resident of Canada, Australia or Japan. Appendix Definitions used in this announcement are as follows: "Acquisition" the acquisition of the entire issued share capital of MV Sports to be effected by way of the Scheme; "AIM" the Alternative Investment Market of London Stock Exchange plc; " "A" Ordinary Shares" the "A" ordinary shares of 1p each in the capital of the Company; "Buyback" the purchase by the Company of the 102,125,309 "A" Ordinary Shares in the capital of the Company which are in issue as at the date of this announcement; "Buyback Contract" the contract setting out the terms on which the Buyback will take place; "Capital Reduction" the proposed reduction of share capital of the Company as described in the Circular; "Company" or "Tandem" Tandem Group plc; "Companies Act" the Companies Act 1985 (as amended); "Consideration Shares" the New Ordinary Shares (or, if the Share Capital Reorganisation does not proceed, Ordinary Shares) which it is proposed will be allotted to MV Sports Shareholders pursuant to the Scheme; "Directors" the directors of Tandem; "Extraordinary General Meeting" or "EGM" the extraordinary general meeting of the Company convened for 18 March 2003 pursuant to the Notice of EGM; "MV Sports" MV Sports Group Plc; "MV Sports Scheme Shareholders" the MV Sports Shares: (a) in issue at the date the Scheme document is posted excluding 1 MV Sports Share registered in the name of Tandem; (b) issued after the date the Scheme document is posted and prior to 6.00 p.m. on the day prior to the day immediately before the meeting convened at the direction of the Court pursuant to the Scheme; and (c) issued thereafter and prior to midnight on the business day immediately preceding the day of the hearing of the petition to sanction the Scheme either on terms that the original or any subsequent holders thereof shall be bound by the Scheme or in respect of which the holders thereof shall have agreed to be bound by the Scheme; "MV Sports Shares" the ordinary shares of 0.1p each in the capital of MV Sports; "New "B" Ordinary Shares" the "B" ordinary shares of 36p each in the capital of the Company which will be created upon completion of the Share Capital Reorganisation; "New Ordinary Shares" the ordinary shares of 4p each in the share capital of the Company which will be created upon completion of the Share Capital Reorganisation; "Notice of EGM" the notice convening the EGM; "Ordinary Shares" the ordinary shares of 4p each in the capital of the Company (but, for clarity, not the New Ordinary Shares); "Proposals" the Capital Reduction, the Share Capital Reorganisation and the Buyback; "Scheme" the proposed scheme of arrangement under section 425 of the Companies Act between MV Sports and its shareholders "Share Capital Reorganisation" the increase in authorised share capital and the consolidation, sub-division and conversion of the Ordinary Shares "Tandem Shareholders" holders of Ordinary Shares; This information is provided by RNS The company news service from the London Stock Exchange END CIRBDGDDLBDGGXB
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