Avanti Capital PLC Completion of Disposal (9015D)
July 12 2016 - 2:32AM
UK Regulatory
TIDMAVA
RNS Number : 9015D
Avanti Capital PLC
12 July 2016
12 July 2016
Avanti Capital plc ("Avanti" or the "Company")
Update relating to the conditional disposal of investment in
Mblox Inc. ("Mblox")
Further to the 13 May 2016 announcement, the board of directors
of Avanti (the "Board") wishes to update its shareholders with
regard to further information concerning the conditional disposal
of the Company's interests in Mblox. CLX Communications AB ("CLX")
has today announced that completion of the merger agreement with
Mblox has now occurred.
Based on the terms of the merger agreement between Mblox and
CLX, Avanti has been advised that it will receive cash of
approximately US$2.9m (approximately GBP2.1m assuming an exchange
rate of GBP1 = $1.40). The balance of the consideration of
approximately US$0.9m (approximately GBP0.6m) has been confirmed by
Mblox as the amount that is required to be held in the escrow
retention account, being Avanti's share of the overall
consideration held in in the escrow retention account. The terms of
the escrow retention account are such that, subject to any warranty
or other claims that may be brought by CLX, the retention monies
will be paid out 18 months after completion, with Avanti receiving
their pro rata entitlement.
The Board estimates that the pro forma 31 December 2015 net
asset value, taking into account the sale of Avanti's interests in
Mblox, is GBP3.1m or 39 pence per ordinary share (assuming an
exchange rate of GBP1 = $1.40, being the assumed exchange rate as
at 31 December 2015).
Following receipt of monies from CLX and having obtained legal
advice from the Company's solicitors, it is the intention of the
board of Avanti to settle its outstanding liabilities. These are
principally Odyssey Partners Limited, a company in which Richard
Kleiner has a 50% interest, who under the terms of the investment
management agreement entered into in November 2008 ("IMA"), are due
a payment of accrued unpaid management fees of GBP132,000
(excluding VAT) and a carried interest payment of approximately
GBP800,000, of which GBP617,000 is payable now and the balance
payable following release of monies from the escrow retention
account (assuming no claims have been made by CLX).
Following receipt of monies due from CLX and payment of amounts
due under the IMA, the Board's intention is to declare a dividend
of 22 pence per share, equivalent to approximately GBP1.8m. Further
details will be provided once the dividend has been declared by the
Board, including record date and payment date.
With effect from 1 July, the Board has agreed not to take any
further directors fees. In addition, other than payment of amounts
due to Odyssey Partners Limited under the IMA as described in the
previous paragraph of up to GBP915k (excluding VAT), Odyssey
Partners Limited and the Board have reached agreement such that
there will be no further amounts payable to Odyssey Partners
Limited with effect from 1 July 2016.
Following receipt of monies from the disposal of Avanti's Mblox
interests and payment of amounts due under the IMA, the Board
believes that it is appropriate to seek shareholders' approval for
a delisting from AIM, in order to reduce overhead costs to very
modest levels for the period until the receipt of monies from the
Mblox escrow retention account. The Board will also seek to
monetise any value for its other investments all of which are
currently written down to GBPnil, although there is no current
expectation that any value will be monetised.
Following the receipt of monies from the escrow retention
account, referred to above, the Board's current intention is that
it would then appoint a liquidator in order to effect a liquidation
and return of remaining cash to shareholders.
The application to de-list from AIM will be subject to special
resolution of the shareholders and further information regarding
this, including a shareholder circular and notice of extraordinary
general meeting, will be notified in due course.
This announcement contains inside information for the purposes
of Article 7 of Regulation (EU) No 596/2014.
ENQUIRIES:
Avanti Capital Plc Tel: 020 7299 1459
Richard Kleiner
Panmure Gordon (UK) Limited Tel: 020 7886 2500
Andrew Potts
Notes:
The Company entered into the IMA, in November 2008 in the
aftermath of the Lehman collapse and when the share price was 67p.
In addition to the dividends of 105p per share paid in early 2014,
following the sale of the Company's investment in Eclectic Bar
Group plc, and the intended 22 pence dividend (expected to be
declared following completion), shareholders return would have been
a total of 127 pence per share, representing a return since
November 2008 of 1.89x or 89.6% (equivalent to approximately 8% per
annum compound). These figures ignore any final distribution
following the ultimate liquidation of the Company.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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