TIDMEBIV
RNS Number : 8735B
Eastbridge Investments PLC
21 June 2016
21 June 2015
Eastbridge Investments Plc
("Eastbridge" or the "Company")
NOTICE OF GENERAL MEETING
On 13 October 2015 Eastbridge announced a new investing policy,
which was approved by shareholders at an extraordinary general
meeting held on 30 October 2015. This change in policy was as a
result of the Company being unable to fulfil its previous policy
and in response to an approach by Helix Investment Management SLP
("Helix") regarding a future strategy for Helix and Eastbridge to
work together.
Upon the approval of shareholders for the new investing policy
an investment was made into the Company by clients of Helix and
this was utilised to purchase an initial GBP500,000 of the Tranche
B Helix Securitisation Fund, yielding 9.85% per annum.
On 11 January 2016 it was announced that non-binding heads of
terms had been entered into for a potential reverse acquisition of
Privilege Wealth Plc ("Privilege"). Regrettably, this potential
transaction has yet to be consummated although negotiation has
continued since January.
INVESTING POLICY
The directors of Eastbridge have now received an alternative
proposal regarding the future of the Company. In light of the
limited progress that has been made in respect of the acquisition
of Privilege and the short time remaining until the Company is
liable to be cancelled from trading on AIM, the directors have
agreed with the owners of Privilege that, conditional on the
passing of the resolutions to be proposed at the general meeting to
be held on 24 June, negotiations with Privilege regarding the
potential reverse transaction be terminated and that the Company
will pursue the alternative proposal.
Under the new terms being offered the Company will, conditional
upon shareholder consent, receive up to GBP3.17 million of new
investment which will be immediately deployed towards fulfilment of
its revised investing policy. The funds will be invested in a range
of low-risk equity and debt instruments issued by banks and other
financial service providers which produce regular cashflow and this
will be used as the cornerstone of the Company's investment
portfolio. It is the current intention that further funds will be
raised later in the year to add to the portfolio.
The Company's existing investing policy states that it will make
"investment into asset backed or insured equity and debt
instruments which make regular cash payments, principally those
used to fund retail finance in the form of secured and unsecured
personal loans from the issuers of the securities being acquired."
The Directors consider that whilst the securities in which they
intend to invest, via the secondary market, satisfy certain of
these criteria, it can be argued that as the funds raised upon the
initial issue of those instruments was not fully utilised for
secured and unsecured personal loans, this being only an element of
the application of funds, the assets being acquired may not qualify
as being in accordance with the Company's investing policy.
The directors of Eastbridge are taking all possible steps not
only to promote the success of the company and generate returns for
shareholders but also to maintain the Company's admission to
trading on AIM. As such, in order to maximise the likelihood that
London Stock Exchange plc will confirm Eastbridge has satisfied its
investing policy upon acquiring these new assets, the Company has
today called a general meeting to be held on 6 July 2016 at which
the investing policy will be modified.
The new investing policy to be approved by shareholders is, in
full:
"The Company's investing policy will be to invest in equity or
debt securities or instruments which generate, or are intended to
generate, regular cash payments, issued by banks, other financial
institutions and companies who offer retail and non-retail
consumers secured and unsecured loans. These equity or debt
securities or instruments will be purchased either via the public
markets or directly from the issuers or their authorised
offerors.
All investments made by the Company will be passive in nature
and without a specified minimum or maximum holding period. It is
the intention of the Company to equally weight its investments on
the basis of projected yield, but it is intended that no single
investment represent more than 20 per cent of the assets of the
Company at the time of acquisition of that investment.
The Company does not anticipate borrowing or gearing its balance
sheet in order to make investments, nor does it anticipate
cross-holdings.
Whilst the securities or instruments to be acquired are all
intended to generate regular cash payments, it is the intention of
the Company, in the short term, to reinvest the returns on its
investments and to grow its portfolio, rather than returning cash
to shareholders in the form of dividends or other distributions.
Accordingly investors should regard the potential return from
holding shares in the Company as being of a capital, rather than
income, nature. The Company does not intend to establish a fixed
life after which it will seek to realise its investments and return
capital to shareholders.
Upon completion of the proposed investments, the Board believes,
based upon its current outgoings, that the Company will have
sufficient financial resources and income to continue to operate
indefinitely."
GENERAL MEETING
The Company has posted a circular to shareholders setting out
details of the proposed changes and calling an extraordinary
general meeting for 6 July 2016 at which a single resolution will
be put to shareholders to approve the new investing policy.
PLACING
Conditional upon approval of the investing policy, the Company
intends to issue up to 2.64 billion new Ordinary Shares at a price
of 0.12p per share to a limited number of new institutional and
professional investors. The new investors, who are unconnected,
will hold, in aggregate, approximately 86 per cent. of the issued
share capital of the Company following the placing and the net
proceeds will be utilised to make investments in a range of
instruments in accordance with the new investing policy set out
above. The precise details of the instruments and the amount
purchased will be determined by reference to market price and
availability at the time the placing is completed and further
details will be provided in due course.
TRADING ON AIM
The Company's ordinary shares have been suspended from trading
on AIM since 11 January 2016, being one year from the date it
became an investing company. Presuming that the new investing
policy is adopted, the placing completed and a range of new
investments acquired the Company will apply to AIM Regulation for
confirmation that, by holding approximately GBP3.6 million of
securities spread across a range of issuers in accordance with its
investing policy, it has satisfied its investing policy and thus
trading in its ordinary shares, including the placing shares,
should resume. Further details of the application for resumption of
trading will be given in due course.
WARRANTS
On 21 December 2015 the Company announced that it had entered
into a warrant issuance programme with Peterhouse Corporate Finance
Limited ("Peterhouse"), pursuant to which Peterhouse was granted a
warrant to subscribe for up to 1.5 billion new ordinary shares in
Eastbridge at a variable price related to the market price of the
Company at any time between 4 January 2016 and 4 January 2018. The
purpose of this programme was to create a mechanism whereby an
ongoing marketing campaign could produce regular cash injections
into the Company.
Eastbridge and Peterhouse have now agreed, conditional upon the
passing of the resolutions to be proposed at the general meeting to
be held on 24 June, to cancel this warrant programme in its
entirety. In addition, a separate warrant issued to Peterhouse on
30 January 2015 to subscribe for ordinary shares up to 3 per cent.
of the Company from time to time at a price of 0.14p per share and
a warrant held by Helix to subscribe for up to 8.5 billion ordinary
shares at a price of 0.3p per share will also be cancelled
conditional upon passing of the resolutions to be proposed at the
general meeting to be held on 24 June.
For further additional information please contact:
Eastbridge Investments Plc Tel: +44 (0)78
Gregory Collier 301 82501
Nominated Adviser Tel: +44 (0)20
Northland Capital Partners 3861 6625
Limited
William Vandyk / Matthew Johnson
Broker Tel: +44 (0)20
Peterhouse Corporate Finance 7469 0930
Limited
Fungai Ndoro /Lucy Williams
This information is provided by RNS
The company news service from the London Stock Exchange
END
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