2022 Annual Report & Notice of AGM
4 August 2022
Renold plc
("Renold", the "Company" or the "Group")
2022 Annual Report and Accounts and 2022 AGM
Related Party Transaction
Renold announces that it has today posted to its shareholders the annual report and accounts for the year ended 31 March 2022 (the "2022 Annual Report and Accounts").
Renold has also posted to its shareholders a circular containing the notice convening the 2022 annual general meeting ("2022 AGM") and form of proxy for use at the 2022 AGM.
As noted in the Company's Final results announcement dated 13 July 2022, and set out in the 2022 Annual Report and Accounts, the board of Directors of the Company (the "Board") has become aware of an issue concerning technical compliance with the Companies Act 2006 in relation to the payment of dividends (amounting in aggregate to £69,657.84) to the Company's Preference Shareholders between 1 July 2019 and 2 January 2021 (the "Relevant Distributions"). The effect of prior year adjustments to the annual report and accounts for the year ended 31 March 2020 (which had an impact upon prior accounting periods) is that four dividend payments paid to Preference Shareholders between 1 July 2019 and 2 January 2021 were paid at a time when the Company did not hold adequate distributable reserves. However, there were sufficient reserves held in subsidiaries of the Company which could have been distributed to the Company in order to provide the Company with adequate reserves at that time.
Dividend Rectification
The Company has been advised that, as a consequence of the Relevant Distributions having been paid otherwise than in accordance with the Companies Act 2006, the Relevant Distributions are technically unlawful and that the Company may have claims against past and present Preference Shareholders who were recipients of the Relevant Distributions, and against persons who were directors of the Company at the time of the payment of the Relevant Distributions.
The Board notes, however, that the Company has no intention of bringing any such claims and that the Group's historic reported trading results and financial condition and ability to pay future dividends are entirely unaffected by this matter.
The circular posted today by Renold convening the 2022 AGM to be held on 6 September 2022 includes a resolution proposing to authorise various rectifying actions which will, if passed, put all potentially affected parties, so far as possible, in the position in which they were always intended to be (the "Rectification Resolution").
Related Party Transaction
The entry by the Company into the Preference Shareholders' Deed of Release and consequential waiver of any rights of the Company to make claims against Preference Shareholders in respect of the Relevant Distributions constitutes a related party transaction pursuant to Rule 13 of the AIM Rules, in respect of Fiske Nominees Limited, as a result of owning (non-voting) Preference Stock totalling in excess of 10 per cent.
In addition, the entry by the Company into the Directors' Deed of Release and consequential waiver of any rights of the Company to make claims against past and present directors in respect of the Relevant Distributions, constitutes a related party transaction pursuant to Rule 13 of the AIM Rules as each of the Directors, excluding Victoria Potter, is a related party for the purposes of the AIM Rules.
Victoria Potter is considered to be independent for the purposes of AIM Rule 13 in respect of the Rectification Resolution. Having consulted with the Company's nominated adviser, Peel Hunt LLP, the independent director considers that the Rectification Resolution (and specifically the entry by the Company into the Preference Shareholders' Deed of Release and the Directors' Deed of Release) is fair and reasonable insofar as the shareholders of the Company are concerned.
An electronic copy of the 2022 annual report and the notice of the 2022 annual general meeting are available for download from the Company's website at www.investors.renold.com.
All capitalised terms in this announcement are as defined in the circular.
The 2022 AGM will be held at 11.00am on 6 September 2022 at the Company's registered office at Trident 2, Trident Business Park, Styal Road, Wythenshawe, Manchester M22 5XB.
ENQUIRIES:
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Renold plc |
IFC Advisory Limited |
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Andrew Batchelor, Company Secretary |
Tim Metcalfe |
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Graham Herring |
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0161 498 4500 |
020 3934 6630 |
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Nominated Adviser and Joint Broker |
Joint Broker |
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Peel Hunt LLP |
FinnCap Limited |
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Mike Bell |
Ed Frisby / Tim Harper (Corporate Finance) |
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Ed Allsopp |
Andrew Burdis / Harriet Ward (ECM) |
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020 7418 8900
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020 7220 0500 |
NOTES FOR EDITORS
Renold is a global leader in the manufacture of industrial chains and also manufactures a range of torque transmission products which are sold throughout the world to a broad range of original equipment manufacturers and distributors. The Company has a well-deserved reputation for quality that is recognised worldwide. Its products are used in a wide variety of industries including manufacturing, transportation, energy, steel and mining.
Further information about Renold can be found on the website at: www.renold.com
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