TIDMSTRL
RNS Number : 8046T
Stirling Industries PLC
19 November 2019
THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION FOR THE PURPOSES
OF THE MARKET ABUSE REGULATION (EU) NO. 596/2014.
THIS ANNOUNCEMENT, INCLUDING INFORMATION CONTAINED HEREIN, IS
RESTRICTED AND IS NOT FOR PUBLICATION, DISTRIBUTION OR RELEASE,
DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO THE UNITED
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THE UNITED STATES AND THE DISTRICT OF COLUMBIA) (COLLECTIVELY, THE
"UNITED STATES"), CANADA, AUSTRALIA, JAPAN OR THE REPUBLIC OF SOUTH
AFRICA OR IN OR INTO ANY OTHER JURISDICTION IN WHICH SUCH
PUBLICATION, DISTRIBUTION OR RELEASE WOULD BE PROHIBITED BY ANY
APPLICABLE LAW.
THIS ANNOUNCEMENT IS FOR INFORMATION PURPOSES ONLY AND IS NOT
AND DOES NOT CONSTITUTE, CONTAIN OR FORM PART OF AN OFFER TO SELL
OR ISSUE OR A SOLICITATION TO BUY, SUBSCRIBE FOR OR OTHERWISE
ACQUIRE, ANY SECURITIES IN THE UNITED STATES, CANADA, AUSTRALIA,
JAPAN OR THE REPUBLIC OF SOUTH AFRICA OR ANY OTHER JURISDICTION IN
WHICH ANY SUCH OFFER OR SOLICITATION WOULD BE UNLAWFUL.
Stirling Industries plc
("Stirling" or the "Company")
Update on proposed acquisition of Ipsen International and
proposed cancellation of admission of Ordinary Shares to trading on
AIM
The Company announces its proposed wind-up, de-listing and
liquidation.
In accordance with the AIM Rules for Companies (the "AIM
Rules"), the Company hereby notifies the proposed cancellation of
the admission of its ordinary shares to trading on AIM (the
"Cancellation"), on 24 December 2019 subject to shareholder
approval at a general meeting to be held at Ashurst LLP, London
Fruit & Wool Exchange, 1 Duval Square, London, E1 6PW at 1.00
pm on 16 December 2019 (the "General Meeting").
Background to, and reasons for, the Cancellation
In its announcement on 17 October Stirling (AIM: STRL.L)
confirmed that the Company was exploring a variety of solutions
with potential providers of equity and private capital that would
enable the acquisition of Ipsen International GmbH ("Ipsen") (the
"Transaction) to proceed. The board acknowledged at that time that
the transaction could not be funded through the public markets due
to the deteriorating capital market conditions weighing on investor
sentiment .
The Company has sought alternative sources of funding for the
Transaction, while also taking steps to reduce its cost base.
Having explored a number of alternative scenarios the board is
disappointed to confirm that no viable source of funding has been
secured. In addition, given the continued headwinds in the macro
environment and in particular in the midcap industrial sector, the
board has concluded that it is in the best interests of all
shareholders that it proceeds to focus on the preparation for an
orderly delisting and winding up of the company and to return
remaining funds to shareholders.
The board continues to believe that the long-term value creation
opportunity of the Transaction is compelling, and entirely
consistent with the objectives stated at the time of our AIM
admission. However, the prevailing equity market environment and
macro uncertainty have deteriorated since terms were agreed with
the vendor, and accordingly the Company has not been able to
complete the fully funded Transaction at this time.
The board believes that the costs to shareholders of continuing
the company in its current form and maintaining an AIM listing are
now outweighed by the benefits of completing the Cancellation, at
which point it is intended the Company would be wound up by the
liquidators (subject to the passing of the required shareholder
resolutions at the General Meeting). The liquidation resolutions
are conditional on the passing of the Cancellation resolution.
The costs which would no longer be incurred as a result of the
proposals would be substantial and would include (without
limitation):
-- running costs being reduced following notice being served in
October to the three executive directors of the Company in their
capacity as employees;
-- the Company no longer being required to bear the costs of
maintaining a nominated adviser for the purposes of the AIM Rules;
and
-- the Company no longer being required to pay listing fees to
the London Stock Exchange in respect of its AIM listing.
The Company's shares remain suspended and an explanatory
circular will be sent to shareholders shortly containing a notice
of an EGM. The "Circular" details the process for the winding up of
the Company and cessation of activities and seeking shareholder
approval for the Cancellation. The board expects the winding up of
the Company to be carried out in the spring of 2020 and that this
will realise approximately 7.00 pence per ordinary share.
Circular and General Meeting
The Board is proposing resolutions to approve the Cancellation
at the General Meeting. The Circular is being prepared and will
shortly be posted to shareholders further detailing the proposals
(including the Cancellation and appointment of liquidators) and
will set out the reasons for the proposed Cancellation and the
winding-up of the Company. It also explains why the board
unanimously considers the proposed Cancellation and winding-up to
be in the best interests of the Company and its shareholders as a
whole and why it is recommending that shareholders should vote in
favour of the proposed Cancellation at the General Meeting. The
notice convening the General Meeting will also be set out in the
Circular.
The Cancellation is conditional, pursuant to Rule 41 of the AIM
Rules for Companies (the "AIM Rules"), upon the approval of not
less than 75 per cent of the votes cast by shareholders (whether
present in person or by proxy) at the General Meeting.
In accordance with Rule 41 of the AIM Rules, the Company will
notify the London Stock Exchange of the date of the proposed
Cancellation prior to the publication of the Circular and a
detailed timetable of the principal events leading up to the
Cancellation will be included in the Circular.
Members' Voluntary Liquidation
The board considers that the most efficient means of returning
capital to shareholders is by way of members' voluntary
liquidation. Conditional on the passing of the resolutions, James
Money and Mike Rollings of Rollings Butt LLP have agreed to act as
liquidators of the Company. Pursuant to their engagement, the
liquidators have agreed to do all things necessary to facilitate
the winding up of the Company and its subsidiaries.
Cancellation of Admission to Trading on AIM
The effect of the Cancellation will be that the ordinary shares
will no longer be quoted or tradable on AIM and shareholders will
not therefore be readily able to sell their ordinary shares. The
only opportunity for shareholders to sell their ordinary shares
would arise upon a sale of all of the issued share capital of the
Company to a third party. There is no current intention to do this
and the only proposals in respect of the Company are to wind it
up.
Recommendation
The Directors consider that the proposals are in the best
interests of the Company and its shareholders and, accordingly,
unanimously recommend that shareholders vote in favour of the
resolutions in the Circular.
Blair Illingworth, Chief Executive, said:
"Ipsen is an ideal asset with strong performance improvement
potential and very much in line with our investment policy and
raison d'etre. It is with great disappointment that we have
concluded that the timing and financing markets are not currently
supportive of this transaction and therefore the Stirling
Industries' model. We have done what we clearly set out at our IPO
and the team has performed extremely well in getting this potential
transaction to this point. It is both disappointing and frustrating
that circumstances beyond our control have conspired to prevent
further progress. Notwithstanding we are very grateful to our
investors and advisors for their support, and we thank them.
We will ensure that the winding up process is handled
expeditiously and efficiently to maximise the net proceeds returned
to shareholders."
This announcement contains inside information for the purposes
of the Market Abuse Regulation (EU) NO. 596/2014. Upon the
publication of this announcement, this inside information is now
considered to be in the public domain. The person responsible for
arranging for the release of this announcement on behalf of
Stirling is Simon Thomas, Chief Operating Officer and Company
Secretary of Stirling.
- Ends -
For more information contact:
Stirling Industries plc
Blair Illingworth, Chief Executive
c/o Montfort Communications +44 (0)78 1234 5205
Montfort Communications - Financial Communications
Olly Scott +44 (0)78 1234 5205
Numis Securities - Nominated Adviser and
Broker
Luke Bordewich
Ben Stoop +44 (0)20 7260 1000
Numis Securities Limited is authorised and regulated by the
Financial Conduct Authority, is acting only for the Company in
connection with the matters described in this announcement and is
not acting for or advising any other person, or treating any other
person as its client, in relation thereto and will not be
responsible for providing the regulatory protection afforded to its
clients or advice to any other person in relation to the matters
contained herein.
About Stirling
Stirling was established to offer a differentiated management
and ownership approach for industrial businesses where the
strategic and operational expertise of its team combines with that
of the portfolio company's management to drive and enable
improvements that create long-term shareholder value.
The Company focused on acquiring businesses with strong
fundamentals and enterprise values between GBP100 million and
GBP750 million. Transactions would be financed through a
combination of new equity and prudent leverage, with the Company's
target debt to be no more than 2.5x the Company's EBITDA.
Stirling's approach began with the belief that many companies
have the potential to achieve material operational enhancement and
margin improvement. Stirling's value add was to ensure operating
assets have the right strategy, the right focused leadership,
empowered and incentivised management teams and the appropriate
capital investment to support growth.
The Company's leadership team has significant experience of
identifying the key value drivers of a given business, implementing
change strategies across a diverse range of industries and
delivering significant operational value creation.
This information is provided by RNS, the news service of the
London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
Kingdom. Terms and conditions relating to the use and distribution
of this information may apply. For further information, please
contact rns@lseg.com or visit www.rns.com.
END
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