25 June 2004
('Asite' or the 'Company')
Extraordinary General Meeting
On 8 June 2004 it was announced that the board of Asite (the 'Board') had
undertaken a review of the financial structure of the Company and its operating
subsidiary, Asite Solutions Limited ('Asite Solutions') (together the 'Group')
and had decided to undertake a number of actions to enable these companies to
improve substantially their net asset position.
The Board has now finalised the terms of agreements with certain key
shareholders in Asite designed to implement these actions. In addition, the
Board is seeking to establish appropriate equity incentivisation arrangements
with the directors and management and with key strategic customers. The
proposed actions are described in further detail below.
These actions involve, amongst other things, the disapplication of statutory
pre-emption rights and amendments to the Company's articles of association in
connection with the creation of a new class of non-voting shares and,
accordingly, the Board is seeking the approval of Shareholders to implement
these actions. An Extraordinary General Meeting of the Company (the 'EGM') has
been convened to be held at 10.30 a.m. on 21 July 2004.
Conversion of loans from Rotch Property Company Limited and R20 Limited
Mr Robert Tchenguiz, through Rotch Property Company Limited and R20 Limited,
companies ultimately owned and controlled by the Tchenguiz Family Trust (a trust
associated with Mr Tchenguiz) has provided the Company with financial support in
the form of a non-interest bearing loan which as at 24 June 2004 was in the
amount of £7,079,072.40 (the 'Tchenguiz Loan').
The Tchenguiz Family Trust (through the holding of B&C Plaza Limited, a company
ultimately owned and controlled by the Tchenguiz Family Trust), is interested in
26,607,062 ordinary shares (representing 25.9 per cent. of the current issued
share capital of Asite).
Mr Tchenguiz has agreed to a conversion of the loans from Rotch Property Company
Limited and R20 Limited and has entered into a loan conversion agreement with
the Company, (the 'Loan Conversion Agreement'). Under the terms of the Loan
Conversion Agreement, Mr Tchenguiz has agreed, conditional on the passing of the
resolutions proposed at the EGM, to convert the entire Tchenguiz Loan into
shares in the capital of the Company at a price of 10 pence per share.
The conversion of the Tchenguiz Loan, if completed, may result in the Tchenguiz
Family Trust (or a company or person it nominates) being issued with such number
of ordinary shares as takes the combined holding of it and parties considered to
be concert parties of it, up to but not in excess of 29.99 per cent. of the
issued ordinary shares.
The remaining shares to be issued pursuant to the Loan Conversion Agreement
shall take the form of B ordinary shares. The B ordinary shares shall
participate in the profits and assets of the Company pari passu with ordinary
shares but shall be non-voting and confer no right to receive notice of or
attend general meetings of the Company. They shall not be admitted to trading
A holder of B ordinary shares will be entitled to convert them into fully paid
ordinary shares on a one for one basis but only if that holder's holding of
shares, when aggregated with shares held or acquired by any person acting in
concert with him, does not exceed 29.99 per cent. of the number of voting shares
issued by the Company (so as to avoid the requirement to make a general offer to
shareholders under Rule 9 of the City Code on Takeovers and Mergers).
If the full amount of the Tchenguiz Loan (being £8,458,501.40 inclusive of
additional loans committed to Asite) is converted into equity and issued to B&C
Plaza Limited, based on the current issued share capital, B&C Plaza Limited will
hold 26,607,062 voting ordinary shares and 84,585,014 non-voting B ordinary
shares, representing 59.3 per cent. of the issued share capital of the Company.
The Directors (excluding Mr Tchenguiz given his involvement in the proposed
conversion) consider, having consulted with the Company's Nominated Adviser,
Deloitte Corporate Finance, that the terms of the conversion are fair and
reasonable insofar as the shareholders of Asite as a whole are concerned.
Purchase of interests of minority shareholders in Asite Solutions
Asite conducts its business through Asite Solutions. The Board believes that it
is in the best interests of the Company to purchase the holdings of all the
minority shareholders in Asite Solutions so that Asite Solutions is a 100 per
cent. subsidiary of Asite, thereby removing the minority interest from the
consolidated accounts of Asite. The proposal is that Asite will acquire the
remaining minority holdings in consideration of the issue of options over
6,525,482 new ordinary shares.
Asite has already entered into an agreement to implement this proposal with BAA
plc and has reached an agreement in principle with Stanhope Properties Limited.
It is also in discussions with the other minority shareholders in Asite
Solutions to finalise agreements on similar terms to those with BAA plc and
Stanhope Properties Limited, the two largest minority shareholders in Asite
Solutions. The options will have an exercise price of 10 pence per share if the
option is exercised on or before 31 December 2004 and 15 pence per share
In addition, Tom Dengenis has agreed to transfer his entire holding of 60 shares
in Asite Solutions to Asite in consideration of the payment of £60.
Grant of options to major customers
Asite wishes to issue its major customers (being customers with a long term
framework contract with Asite or who, the Directors believe, are significant to
the Group's business) options over up to 80,000,000 new ordinary shares in the
capital of the Company. The Board considers that by granting options to its
major customers, it will strengthen its trading relationship with such customers
as they will have a vested interest in the future performance of the Company.
As an alternative to entering into an option agreement, the Board may offer
major customers the opportunity to subscribe for new ordinary shares at the same
price and on similar terms to those set out in these option agreements.
Asite has entered into an agreement with BAA plc in respect of the grant of an
option over 15,000,000 new ordinary shares, O'Rourke Investments plc in respect
of the grant of an option over 17,362,400 new ordinary shares and has reached an
agreement in principle with Stanhope Securities Limited in respect of the grant
of an option over 7,124,932 new ordinary shares.
Major customers who are issued with options will have three years to exercise
their respective options, in whole or in part (and so that they may exercise
their options on more than one occasion), at an exercise price of 10 pence per
share. If the option is exercised on or before 31 December 2004, there will be
no lock-in period for holding the new ordinary shares issued on exercise of the
option. If the option is exercised after 31 December 2004, there will be a two
year lock-in period subject to limited exceptions.
Issue of options to executive directors and employees
Given recent changes in personnel in the Group and the appointment of three new
executive directors, the Board proposes to grant options over up to 15 million
ordinary shares in total to its four executive directors and 3 million ordinary
shares to employees below Board level. The allocation of the new ordinary
shares to the executive directors will be determined by the Board in line with
the recommendations of its remuneration committee.
Issue of options to non-executive directors
The Company's non-executive directors have agreed to receive payment, by way of
options over new ordinary shares at an exercise price of 10 pence per share, in
lieu of cash to cover remuneration due in respect of the year ending 31 December
2004. The Directors are therefore seeking shareholder approval, at the EGM, for
the authority to disapply the statutory pre-emption rights of shareholders so
that the Company can issue new ordinary shares under the following options:
• an option over up to 600,000 new ordinary shares to Sir John Egan;
• an option over up to 300,000 new ordinary shares to Walter Goldsmith
• an option over up to 150,000 new ordinary shares to Robert Tchenguiz;
• an option over up to 150,000 new ordinary shares to Mathew Riley or, at his
nomination, BAA plc; and
• an option over up to 150,000 new ordinary shares to Peter Rogers or, at his
nomination, Stanhope Securities Limited.
These option agreements operate so that quarterly in arrears, as the
remuneration of the relevant non-executive director falls due, the option vests
in respect of one quarter of the total number of new ordinary shares subject to
Amendment to the articles of association in relation to borrowing powers
The articles of association currently state that the Directors' borrowing powers
are restricted such that the Group's borrowings should not exceed the higher of
£6 million or four times (400 per cent. of) the Company's shareholders' funds.
As at 24 June 2004, due to the Company's cash requirements, the Group's
borrowings were £7,079,072.40 and therefore outside the limits permitted by the
articles of association.
In view of the current level of borrowings relative to shareholders' funds, the
Directors propose that the borrowing powers limit be changed from the higher of
£6 million or four times (400 per cent. of) shareholders' funds to a figure
being the higher of £9 million or six times (600 per cent. of) shareholders'
Calling of and extraordinary general meeting
An explanatory circular and a form of proxy are being sent to shareholders. The
circular explains the reasons for these actions in more detail and includes a
notice of EGM setting out the resolutions to be proposed at the EGM. The
circular also explains why the Board believes the proposed actions to be in the
best interests of the Company and the shareholders of Asite as a whole.
Copies of the circular will be available to the public free of charge from
Asite's offices at Leconfield House, Curzon Street, London W1J 5JA.
For further information, please contact:
Tom Dengenis 020 7647 5151
Deloitte Corporate Finance
Robin Binks 020 7936 3000
The directors of Asite accept responsibility for the information contained in
this announcement. To the best of the knowledge and belief of the directors of
Asite (who have taken all reasonable care to ensure that such is the case) the
information contained in this announcement is in accordance with the facts and
does not omit anything likely to affect the import of such information.
This information is provided by RNS
The company news service from the London Stock Exchange