14 December 2007
Embargoed Release: 0700 hrs 14 December 2007
TG21 plc ('TG21' or 'the Group')
TG21 ANNOUNCES FURTHER DISPOSALS IN LINE WITH ITS STRATEGY TO REPOSITION THE
TG21, the vehicle installation service provider supplying public transport CCTV
and other monitoring systems, today announces that its subsidiary company, Toad
(UK) Limited ('Toad'), has disposed of its 'Sigma' and 'Toad Security'
businesses which distribute car alarms and immobilisers. In addition its
subsidiary, Integrated Technologies (International) Limited ('ITI') which
distributes in-vehicle interface leads and trades under the name 'Soundlinx' has
disposed of its business. The disposals have been made by way of asset sales.
The Sigma, Toad Security and Soundlinx names and inventory are to be sold to
Scorpion Electro Systems Limited ('Scorpion'), a private company based in
These Toad and ITI businesses together achieved breakeven in the six months to
30 June 2007 on sales of around £1.5m.
Scorpion is to pay a total cash consideration of £1.67m for the businesses which
includes £0.4m in respect of stock. £1m of the consideration was paid on
completion (13 December 2007) and the balance is to be paid in installments
during 2008. £0.4m will be payable within 120 days of completion; £0.07m is
payable in June 2008 and £0.2m in December 2008. Toad and ITI will incur
combined reorganisation costs of £0.2m and will make an exceptional provision
for remaining obsolete stock of £0.3m. In addition, the Group will make a
provision for onerous leases on vacant premises of £0.3m. The net cash proceeds
will be applied to reduce the Group's bank borrowing.
These disposals are a key step in the repositioning of the business. The Board
anticipates that certain non-recurring costs relating to this ongoing
repositioning will arise in the next financial year and the Board therefore
currently expects that this will have some impact on final year earnings for
Peter Ward, Chairman of TG21, said:
'Following the disposal of our in-car entertainment business earlier this year,
this transaction is the next phase of our strategy to exit from our mature
'Scorpion has a successful track record in the manufacture and distribution of
vehicle security products and they will benefit from the addition of the Sigma,
Toad Security and Soundlinx products to their portfolio.
'This disposal will allow us to reduce our net debt and focus our management and
financial resources on further developing our vehicle installation and public
transport businesses, which we consider to hold the most compelling
opportunities for growth.'
For Further Information:
TG21 plc Nick Grimond, CEO 020 8710 4000
Hogarth Partnership Limited Barnaby Fry/Sarah Richardson 020 7357 9477
Daniel Stewart & Co plc (Nomad) Graham Webster 020 7776 6550
Notes to editors
Launched in 1993, the Company began as Toad plc and was focused on the
distribution of in-car entertainment systems and vehicle security products.
Under the stewardship of Chairman Peter Ward, former Chairman and CEO of Rolls
Royce Motors and Cunard Line, who joined the board at the end of 2001, TG21's
strategy has been to reposition itself away from its legacy businesses into
markets with better growth potential while leveraging its core strengths -
nationwide field force of vehicle electrical engineers, call centre and
In line with this strategy, in 2005 the Company took a controlling stake in 21st
Century Crime Prevention Services Ltd ('21st Century'), the preferred supplier
of on-board CCTV systems for Arriva UK Bus. 21st Century has pioneered the use
of WiFi with on board CCTV systems and was the first company to successfully
launch automatic video downloads and a bus CCTV monitoring system (HeartbeatTM).
In addition to Arriva UK Bus, clients of 21st Century include Arriva
Scandinavia, Go-Ahead Group, Metroline, Kinch Bus and ACIS. In 2006 the Company
bolstered this division, with a strategic investment in another bus CCTV
business, Cyberlyne Communications Limited ('CCL'). This investment was made by
way of a loan of £430,000 to CCL and in parallel with this loan agreement CCL
has granted an option to TG21 to acquire the whole of its share capital.
Recently the Company has completed a number of installations for a pilot 'pay as
you go' motor insurance scheme with a major insurance company and has several
other similar trials in progress. The Company was awarded these opportunities on
the back of the long and valued relationships which it has developed in this
market through its insurance replacement services.
Headquartered in Mitcham, the Group also has leased offices in Blackburn and
employs around 120 staff.
This information is provided by RNS
The company news service from the London Stock Exchange