Disposal
March 18 2009 - 9:43AM
UK Regulatory
TIDMIDD
RNS Number : 0718P
ID Data Group PLC
18 March 2009
18 March 2009
ID Data Group plc
("ID Data" or the "Company")
Disposal
ID Data Group plc announces that ID Data Limited, the Company's main operating
subsidiary which has been in administration since October 2008, has agreed to
dispose of its business and certain of its assets, including its shares in TTi
Card Technology (Europe) Ltd. The disposal is expected to complete by 20 March
2009.
The business of ID Data Limited had been widely marketed to potential buyers
and, although a number of expressions of interest were received, it was not
possible to conclude a sale to any of these parties.
In the absence of any buyer for the business, the Administrators (Malcolm
Shierson and John Whitfield of Grant Thornton) would have needed to proceed with
the closure of the business of ID Data Limited. Faced with this scenario, Peter
Cox (ID Data's CEO) approached initially the main shareholders of ID Data to
raise funds for ID Data to repurchase the assets of ID Data Limited. These
approaches unfortunately did not provide sufficient funding and Peter Cox then
approached external financial backers to assist him in the acquisition of the
business, as he firmly believes that there is a successful future for the
business together with its employees, customers and suppliers. Accordingly, the
business and certain of the assets of ID Data Limited (including plant and
stock) are to be acquired for GBP0.25 million in cash and the assumption of some
GBP0.6 million of debt by a new company, Card Data Management Limited, which is
30% owned by Mr Cox.
As a director of the Company, Peter Cox is a related party and this transaction
is a related party transaction for the purposes of the AIM Rules which require
that announcements of related party transactions include a statement by the
directors (excluding any director involved in the transaction as a related
party) that they consider, having consulted with the AIM company's nominated
adviser, that the terms of the transaction are fair and reasonable insofar as
the AIM company's shareholders are concerned. However, the disposal described in
this announcement is being made pursuant to the insolvency proceedings at ID
Data Limited which is under the control of that company's Administrators acting
independently of the board of ID Data. Accordingly it is not appropriate for the
board of ID Data (excluding Peter Cox) to provide the fair and reasonable
statement as it was not involved in the negotiation or implementation of the
disposal.
ID Data Limited made a loss before tax of GBP(1.5) million on turnover of
GBP9.5 million for the year ended 31 March 2008 and had net liabilities of
GBP(6.7) million at that date (these figures are unaudited). The proceeds of the
disposal will be paid to ID Data Limited and there will be no payment to ID Data
arising from the administration.
In a statement issued by the Joint Administrators, Malcolm Shierson and John
Whitfield stated:
"The business of ID Data Limited has been widely marketed to industry and non
industry organisations both before and during the administration period. We
received seven significant expressions of interest, but primarily due to funding
constraints in the current market, none of these parties completed the purchase
of the business and assets of ID Data Limited.In light of this failure to sell
the business and assets, we concluded that the immediate closure of the business
was the only option available and it was following this that we received the
offer from Card Data Management Limited which has led to the sale of the
business. We observed during the period of administration the ability of this
business to service its clients professionally and meet the most demanding
technology and service requirements, including the delivery of some US$2.5
million worth of chip cards to Norway."
ID Data Group plc - the future
Following this disposal, ID Data now has a number of assets, including
principally: UK tax losses at a holding company level; Irish tax losses through
its wholly-owned non-trading subsidiary Cardbase Technologies Limited; and
investments in Contis Group Limited (pre-paid card service provider; 6%
interest), Sports Loyalty Limited (cardless reward programme; 3.9% interest) and
Digital Locksmiths Limited (smart card security consulting; 50% interest).
The Company will now review the assets it has left and its current and
anticipated future liabilities; following the conclusion of this review and an
assessment of its working capital position, the Company will advise shareholders
of its intended future path.If appropriate the Company will convene a general
meeting to obtain shareholder approval for its strategy going forward and also
to approve a change in the Company's name as the trading name ID Data has been
sold to Card Data Management Limited.
Mike Blackburn, Chairman of ID Data, commented:
"It is ironic that the core business of the Group should have been forced into
administration due to the lack of support from a government-related creditor.
That decision was taken when underlying trading was better than at any time
since the Group was admitted to AIM in 2000.
I very much regret the loss of shareholder value.Peter Cox, the largest
individual shareholder, has worked tirelessly to achieve a different outcome.
It is equally regrettable that there have been job losses at a time when the
economy is not best placed to provide alternative employment for hard-working
staff."
Further announcements will be made in due course and in the meantime trading in
the Company's shares on AIM remains suspended.
-Ends-
For further information, please contact:
ID Data Group plc
Peter Cox, Chief Executive
peter.cox@iddata.com
Tel: +44 (0)1730 235700
Smith & Williamson Corporate Finance Limited
Azhic Basirov / David Jones
Tel: +44 (0)20 7131 4000
This information is provided by RNS
The company news service from the London Stock Exchange
END
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