The Open Offer is not a rights issue. Invitations to apply under
the Open Offer and the Excess Application Facility are not
transferable unless to satisfy bona fide market claims and the
Application Form is not a document of title and cannot be traded.
Qualifying Shareholders should be aware that, unlike in the case of
a rights issue, any Open Offer Shares that are not applied for
under the Open Offer will not be sold in the market or placed for
the benefit of Qualifying Shareholders, but will be taken up under
the Excess Application Facility and/or issued to Conditional
Placees, with the proceeds retained for the benefit of Lonrho.
To be valid, completed Application Forms and payment in full
under the Open Offer and settlement of relevant CREST instructions
(as appropriate) must be received by Equiniti at Aspect House,
Spencer Road, Lancing, West Sussex BN99 6DA no later than 11.00
a.m. on 30 December 2011.
Admission to Trading of New Ordinary Shares
An application will be made to the UKLA and to the London Stock
Exchange for the New Ordinary Shares to be admitted to the premium
listing segment of the Official List and to the London Stock
Exchange's market for listed securities for such shares to be
admitted to trading.
It is expected that Admission will become effective and that
dealings in the New Ordinary Shares will commence at 8.00 a.m. on 4
January 2012.
5. Effect of the Capital Raising
Upon completion of the Capital Raising, the New Ordinary Shares
will represent approximately 20.8 per cent. of the Company's
Existing Ordinary Shares and approximately 17.2 per cent. of the
Company's Enlarged Ordinary Share Capital. New Ordinary Shares
issued through the Placing and Open Offer and New Ordinary Shares
issued through the Firm Placing will account for approximately 40.2
per cent. and 59.8 per cent., respectively, of the total New
Ordinary Shares to be issued.
Following the issue of the New Ordinary Shares to be allotted
pursuant to the Capital Raising, Qualifying Shareholders who take
up their Basic Entitlements in full (without making any application
under the Excess Application Facility) will experience a dilution
of 10.3 per cent. of their interests in the Company as a result of
the Firm Placing. Qualifying Shareholders who do not take up any of
their Basic Entitlements in respect of the Open Offer will
experience a greater dilution of approximately 17.2 per cent. of
their interests in the Company as a result of the Firm Placing and
the Placing and Open Offer.
The Capital Raising will result in an increase in cash and other
short term funds of GBP25.4 million with a corresponding GBP25.4
million increase in net assets.
6. Current trading and prospects
As a result of the Company's change of accounting reference date
to 31 December, on 7 November 2011 the Group announced its second
set of interim accounts for the six month period ended 30 September
2011. For the 12 months to 30 September 2011 Lonrho reported
significant growth in both profitability and revenues. Twelve month
results on a year on year comparison show a 32 per cent. growth in
revenue and a 480 per cent. increase in profit before tax. Six
month results to 30 September 2011 on a year on year comparison
show a 35 per cent. growth in revenue and a 190 per cent. increase
in profit before tax.
Revenue for the six month period to 30 September 2011 was
GBP81.4m, compared to revenue for the same period in the prior year
of GBP60.5m. Profit before tax for the period was GBP5.8m compared
to profit before tax for the same period in the prior year of
GBP2.0m.
Revenue for the 12 months to 30 September 2011 was GBP142.5m
compared with GBP107.8m in the prior year. Profit before tax for
this period was GBP2.9m, compared to profit before tax for the year
to 30 September 2010 of GBP0.5m. Gross margin in the 12 month
period rose from 26.4 per cent. to 26.7 per cent.
Lonrho's strategic objectives remain focused on supporting
Sub-Saharan African economic growth and helping to provide the
services and infrastructure required to enable continued growth. As
a result, Lonrho operates in an environment that is typically
growing strongly and has seen each of its core businesses perform
well during the period. As each division within the Group grows,
margins are improving as each business builds market share and
volumes increase. The Group maintains its policy of only investing
and operating in Africa and is building a reputation as one of a
very few conglomerates with a specific "Africa only" mandate. The
Group maintains its conservative approach of de-risking its
operations through geographical spread (operating in 18 countries)
and by each of Lonrho's five divisions being stand-alone investment
silos with no recourse from one division to the other.
7. Dividends and dividend policy
The Company has not declared a dividend in any of the financial
years ended 30 September 2008, 30 September 2009 or 30 September
2010 nor in the twelve months to 30 September 2011.
The Company intends to adopt a progressive dividend policy once
it has sufficient distributable reserves and has achieved a level
of sustained profitability provided it is, in the opinion of the
Board, commercially prudent to adopt such policy, bearing in mind
the Group's financial position, underlying earnings and cashflows,
the resources required for the Group's development and the
prevailing market outlook.
8. Directors' intentions
The Directors beneficially own, in aggregate, 4,733,214 Ordinary
Shares representing approximately 0.36 per cent. of the issued
Ordinary Share capital of the Company as at 12 December 2011 (the
latest practicable date prior to this announcement). Each of the
Directors so entitled will be taking up his Basic Entitlements in
full to subscribe for New Ordinary Shares under the Open Offer.
As part of the Placing and Open Offer, 10,000,000 of the New
Ordinary Shares are being allocated to David Lenigas who has agreed
to subscribe for these Conditional Placing Shares pursuant to the
Placing. However, allocations of these Conditional Placing Shares
are subject to clawback to satisfy valid applications by Qualifying
Shareholders under the Open Offer.
9. The Board's position
The Board considers the Firm Placing and the Placing and Open
Offer to be in the best interests of the Company and the
Shareholders as a whole.
10. Further information
Further details relating to the Capital Raising will be
contained in the Prospectus that is expected to be published on 13
December 2011. After that date, copies of the Prospectus will be
available for inspection at the registered office of the Company at
Level 2, 25 Berkeley Square, London W1J 6HB during normal business
hours on any Business Day. Copies will also be available to
download, other than in respect of certain jurisdictions, from the
Company's corporate website, www.lonrho.com.
The Prospectus will also be available for inspection during
normal business hours on any weekday (Saturdays, Sundays and public
holidays excluded) at the offices of Panmure Gordon, 155 Moorgate,
London EC2M 6XB.
The Prospectus will also be available for inspection on the
National Storage Mechanism at www.hemscott.com/nsm.do.
Appendix I: Expected Timetable of Principal Events
Record Date for Basic Entitlements close of business
on 9 December
2011
Despatch of the Prospectus to Qualifying 13 December 2011
Shareholders and Application Forms to Qualifying
Non-CREST Shareholders
Ex-entitlements time and date for the Open 8.00 a.m. on 13
Offer December 2011
Basic Entitlements and Excess CREST Open 8.00 a.m. on 14
Offer Entitlements credited to stock accounts December 2011
of Qualifying CREST Shareholders in CREST
Recommended latest time for withdrawing Basic 4.30 p.m. on 22
Entitlements and Excess CREST Open Offer December 2011
Entitlements from CREST
Latest time and date for depositing Basic 3.00 p.m. on 23
Entitlements and Excess CREST Open Offer December 2011
Entitlements into CREST
Latest time and date for splitting Application 3.00 p.m. on 28
Forms (to satisfy bona fide market claims December 2011
only)
Latest time and date for receipt of completed 11.00 a.m. on
Application Forms and payment in full under 30 December 2011
the Open Offer and settlement of the CREST
instructions (as appropriate)
Announcement of results of the Capital Raising 3 January 2012
Admission and commencement of dealings in 8.00 a.m. on 4
New Ordinary Shares on the London Stock Exchange January 2012
New Ordinary Shares credited to CREST stock as soon as possible
accounts (uncertificated as soon as possible after 8.00 a.m.
after holders only) on 4 January 2012
Despatch of definitive share certificates within 7 days
for the New Ordinary Shares in certificated of Admission
form
General notes:
The times set out in the expected timetable of principal events
above are times in London unless otherwise stated, and may be
adjusted by the Company in consultation with or, if required, with
the agreement of Panmure Gordon, in which case details of the new
times and dates will be notified to the UK Listing Authority, the
London Stock Exchange and, where appropriate, Shareholders.
Appendix II: Definitions
Lonrho (LSE:LONR)
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