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TG21 Plc (TGP)

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Wednesday 15 April, 2009

TG21 Plc

Acquisition of remaining shar

RNS Number : 5571Q
TG21 Plc
15 April 2009

15 April 2009

TG21 plc ('TG21', 'the company' or 'the group')

Acquisition of remaining 25% of the ordinary shares in 21st Century Crime Prevention Services Ltd ('21st Century')

TG21, the vehicle installation service provider supplying public transport CCTV and other monitoring systems, today announces that it has acquired the remaining 25% of the ordinary shares in 21st Century Crime Prevention Services Ltd ('21st Century') and that as a consequence 21st Century is now a wholly owned subsidiary of the group.

21st Century supplies on board CCTV and other monitoring systems to the public transport market and for the year ended 31 December 2008 made a profit before tax of £1.6m on turnover of £7.7m.

This acquisition is pursuant to the option agreement dated 18 December 2004 to acquire the entire share capital of 21st Century.  However, the purchase consideration for this final 25% of the equity of 21st Century has been amended by agreement with the vendor.  

The original option specified a cash consideration of £2,107,825 to be paid for the remaining shares immediately that the option was taken up. The revised consideration under the renegotiated terms comprises a mixture of cash, deferred cash and new shares in TG21 the details of which are as follows:

i)  £553,912 in cash paid on completion

ii)  £500,000 in cash to be paid by 4 January 2010

iii) 10,539,125 new TG21 ordinary shares to be issued to the vendor as fully paid up at 10p per share and with a nominal value of £1,053,913

The vendor has also waived any pro-rata entitlement to dividend arising in 21st Century during the current year. The 2008 minority interest dividend was £300,000.

The shares issued to the vendor as part of the total consideration ((iii) above) are subject to a 12 month lock-in agreement.

Chairman of TG21, Peter Ward commented:

'I am delighted that we have been able to complete the purchase of the remaining share capital in 21st Century as this subsidiary is making an increasing contribution to the group's operations and results.  

'I am also pleased to report that, given the current economic climate, we have successfully renegotiated the purchase consideration to include shares in TG21. Based on TG21's closing mid share price on 14 April 2009 of 4.63p, the revised consideration has yielded a saving in excess of £0.5m compared to the original cash consideration and a further £0.5m saving has been made in cash outflow. The purchase also means, of course, that we will retain within the group the future share of profits in 21st Century which previously would have been distributed to the minority interest by way of dividend.  It is particularly pleasing and notable that the vendor has demonstrated his confidence in the group with an effective target price of 10p per TG21 share required for him to realise the total value of the sale proceeds which he originally anticipated.  

'With full ownership comes a further concentration of the business on innovative CCTV and monitoring products for public transport companies, including the recent development and launch of 'EcoManager' which is aimed at saving fuel and improving safety for bus operators by monitoring driver behaviour.'

For Further Information:

TG21 plc

Wilson Jennings, Finance Director

020 8710 4016

Hogarth Partnership Limited

Barnaby Fry

020 7357 9477

Vicky Watkins

Daniel Stewart & Co plc (Nomad)

Graham Webster

020 7776 6550

This information is provided by RNS
The company news service from the London Stock Exchange