Watchstone Group PLC Retention of warranty escrow monies (4866Q)
November 30 2016 - 2:00AM
UK Regulatory
TIDMWTG
RNS Number : 4866Q
Watchstone Group PLC
29 November 2016
Watchstone Group plc
("Watchstone" or the "Group")
Retention of warranty escrow monies
Watchstone Group plc (LON:WTG) notes the announcement by Slater
and Gordon Limited (ASX: SGH) that it has obtained an opinion from
an independent barrister in respect of the warranty escrow relating
to the sale of the Professional Services Division in May 2015
("Opinion").
Watchstone has received a copy of the Opinion, which states that
a warranty claim presented by Slater and Gordon Limited and/or
Slater and Gordon (UK) 1 Ltd (together "SGH") has on balance a
prospect of success and that, if successful, such claim would be
likely to have a value of GBP53m. Accordingly, GBP50m is to be
retained in the warranty escrow account until the warranty claim is
resolved.
The Opinion is solely for the purpose of determining whether the
warranty escrow may be released to Watchstone at this time. It does
not pre-judge the outcome of any legal proceedings. Watchstone
remains satisfied that the warranty claim has no merit and will
defend it robustly if proceedings are brought.
During the process leading to the Opinion, Watchstone had no
right to require disclosure of key evidence in the possession of
SGH which would be relevant to the merits and quantum of the
warranty claim. Watchstone believes this evidence will be available
to it in the event that SGH issues proceedings and it intends to
seek disclosure of such information at the earliest possible
opportunity.
Capital return
Watchstone will now not proceed with its further capital return
to shareholders until the warranty claim detailed above is
resolved.
Balance sheet update
As at 25 November 2016, Watchstone had cash of GBP83.1m
(excluding the Warranty Escrow).
Watchstone will make further announcements in due course, as
appropriate.
For further information:
Watchstone Group plc Tel: 03333 448048
Peel Hunt LLP, Nominated Adviser Tel: 020 7418
and broker 8900
Dan Webster
This information is provided by RNS
The company news service from the London Stock Exchange
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