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SalvaRx Group plc (SALV)

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Tuesday 08 January, 2019

SalvaRx Group plc

Result of AGM and Completion of Disposal

RNS Number : 5463M
SalvaRx Group plc
08 January 2019
 

SalvaRx Group plc

 

("SalvaRx" or the "Company")

 

Result of AGM and Completion of Disposal and Demerger

 

SalvaRx (AIM: SALV), the drug discovery and development company focused on cancer immunotherapy, is pleased to announce that at its Annual General Meeting held earlier today all resolutions set out in the Circular to shareholders dated 27 November 2018 ("the Circular") were duly passed.

 

Disposal of interest in SalvaRx Limited

 

Accordingly, shareholders have approved the sale of the Company's 94.2 per cent. interest in SalvaRx Limited to Portage Biotech Inc. ("Portage") in accordance with the terms of the Sale Agreement for a consideration of US$67.5 million, to be satisfied by the issue of 757,943,784 new shares in Portage (the "Consideration Shares") (the "Disposal").  

 

The Company has been informed that all resolutions proposed at the Annual and Special Meeting of Portage held earlier today were approved, including the terms of the acquisition of the whole of the issued share capital of SalvaRx Limited.

 

Demerger Shares

 

Shareholders have also approved the transfer of 660,593,556 Consideration Shares (the "Demerger Shares") on a pro-rata basis to shareholders on the register on the Demerger Record Date (being 5.00 p.m. on 8 January 2019) (the "Demerger").

 

It is expected that definitive shares certificates in respect of the Demerger Shares will be despatched on or around 15 January 2019 (except to US Persons subject to safe-keeping and custody arrangements) and that definitive share certificates to be issued to US Persons in respect of Demerger Shares will be despatched following the expiry of the Restricted Period on or around 8 July 2019.  During the Restricted Period, all Demerger Shares are subject to the Applicable Restrictions set out in the Circular.

 

Option Redemption and New Options

 

Following completion of the Disposal, the Company has completed the purchase of options over 2,767,470 new Ordinary Shares (the "Option Redemption") in consideration of the grant of new options over a total of 40,692,697 Consideration Shares (the "New Options").  The terms of the New Options are set out in the Circular. 

 

Board changes

 

Denham Eke has been appointed as Chief Financial Officer and as a Director of the Company.  Denham Hervey Newall Eke (aged 67) is Managing Director of Burnbrae Group Limited, a private international asset management company.  He began his career in stockbroking with Sheppards & Chase before moving into corporate planning for Hogg Robinson Plc, a major multinational insurance broker.  He is a director of many years' standing of both public and private companies involved in the financial services, property, mining, and manufacturing sectors.  He is chairman of Webis Holdings Plc, chief executive officer of Manx Financial Group Plc, finance director of Port Erin Biopharma Investments Limited and a non-executive director of Billing Services Group Limited - all quoted on the AIM market.  Mr Eke is also a non-executive director of Juvenescence Ltd., a leader in the development of therapies to slow, halt or potentially reverse aging.  Additional information required to be disclosed in relation to Mr Eke pursuant to Schedule Two, paragraph (g) of the AIM Rules for Companies is set out in the Appendix.

 

Following the resignations of Dr Ian Walters, Kam Shah, Richard Armstrong and Colin Weinberg as directors of the Company with immediate effect from the conclusion of the AGM, the Board now comprises Jim Mellon (Non-executive Chairman), Dr. Greg Bailey (Non-executive Director) and Denham Eke (Chief Financial Officer).  As a result, the Board has no independent directors.  However, the Directors are in the advanced stages of recruiting an independent non-executive director and the Company expects to provide an update on the progress of such appointment in due course.

 

AIM Rule 15 cash shell

 

The Disposal and the Demerger constitute a fundamental change of business under Rule 15 of the AIM Rules.  Following the Disposal and the Demerger, the Company has ceased to own, control or conduct all, or substantially all, of its existing trading business activities or assets.  It is therefore classified as an AIM Rule 15 cash shell and as such is required to make an acquisition or acquisitions which constitutes a reverse takeover under AIM Rule 14 (or seek re-admission as an investing company (as defined under the AIM Rules)) on or before the date falling six months from completion of the Disposal and the Demerger (namely by 9 July 2019), failing which the Company's Ordinary Shares would then be suspended from trading on AIM pursuant to AIM Rule 40.  Admission to trading on AIM would be cancelled six months from the date of suspension should the reason for the suspension not have been rectified.

 

In order to meet its working capital requirements as an AIM Rule 15 cash shell, the Company has retained 56,657,531 Consideration Shares (the "Retained Shares") as a means of increasing its cash reserves amounting to approximately US$50,000 (after meeting the expected costs of the Disposal and the Demerger).  Based on the Portage share price of US$0.105 on the CSE at the close of business on 7 January 2019, the Retained Shares are valued at approximately US$5.95 million (£4.65 million at an exchange rate of £1: US$1.278).  The number of Retained Shares may increase by up to 40,692,697 Consideration Shares to the extent that New Options remain unexercised by 5.00 p.m. on 8 January 2020.  In the event that the cash reserves and any value realised from the Retained Shares are insufficient to meet the Company's working capital requirements, the Directors may seek further funding, including by a further issue of Ordinary Shares.

 

Jim Mellon, chairman of SalvaRx Group plc, commented, "Completion of the Disposal and the Demerger provides the opportunity to unlock and maximise value for the Company's shareholders as well as to secure the funding which SalvaRx Limited requires to support the businesses forming part of its portfolio, to develop clinical proof of concept in cancer immunotherapies and, in addition, to undertake further investments in and/or acquisitions of businesses which are complementary to its portfolio.  Through their holding of Demerger Shares, shareholders are able to retain an interest in the ongoing development of the assets in that portfolio.  In addition, through their holding of Ordinary Shares, shareholders are also able to retain an exposure to the potential upside of the Company's development as an AIM Rule 15 cash shell.

"We welcome Denham to the Company's Board.  He is a valuable addition to the team and his experience will be highly relevant as we look to identify a suitable acquisition for the Company as an AIM Rule 15 cash shell."

This announcement should be read in conjunction with the full text of the Circular which is available on the Company's website at https://www.salvarx.io/investors/aim-rule-26.html.  Capitalised terms in this announcement have the same meaning as given in the Circular.

This announcement contains inside information for the purposes of Article 7 of Regulation (EU) 596/2014.

Enquiries:

 

SalvaRx Group plc

 

Denham Eke, Chief Financial Officer

Tel: +44 (0) 01624 639396

Northland Capital Partners Limited

Nominated Adviser and Broker

Tel: +44 (0) 20 3861 6625

 

Matthew Johnson / Edward Hutton (Corporate Finance)


Vadim Alexandre (Corporate Broking)


Peterhouse Capital Limited

Joint Broker

Lucy Williams / Duncan Vasey

Tel: +44 (0) 20 7469 0932



APPENDIX

Additional information required to be disclosed in relation to Mr Eke pursuant to Schedule Two, paragraph (g) of the AIM Rules for Companies is set out below.

Current Directorships



Achte CRSR & Co KG


Dundrennan Limited

Albany Management Limited


ECF Asset Finance PLC

Albany SIAG Development GbR


Edgewater Associates Limited

Albany SIAG Gerwerbe 1 GbR


European Collateral Finance Limited

Albany SIAG Gerwerbe 11 GbR


European Corporate Finance Limited

Albany SIAG Gerwerbe 111 GbR


European Leasing Limited

Albany SIAG Wohnen 1 GbR


European Wagering Services Limited

Albany SIAG Wohnen 11 GbR


Fuenfte CRSR & Co KG

Galloway Limited

Genseq Limited

All Star Leisure (Group) Limited


Arundel Services Limited


B.E. Global Services Limited


Horsfield Limited

betInternet.com (IOM) Limited


IC Technology (UK) Limited

betInternet.com NV


Indigo Securities Limited

Big Group plc


Juvenescence AI Limited

BigSave Limited


Juvenescence Limited

Billing Service Group Limited


Juvenescence UK Limited

BMIP Limited


Juvent Holdings Limited

Bradburn Limited


KG Antell (SIAG 16) KG

Bradda Head Holdings Limited


Mann Bioinvest (BVI) Limited

Bradda Head International Limited


Mann Bioinvest Limited

Burnbrae Belgium Limited


Mann Pathfinder IC

Burnbrae Charlottenburg GmbH


Manx Financial Group plc

Burnbrae Commercial GmbH


Manx Financial Limited

Burnbrae Development GmbH


Manx Incahoot Limited

Burnbrae East GmbH


Master Investor Limited

Burnbrae Events Limited


Mediqventures Limited

Burnbrae Friedrichstein GmbH


Navrona Investments Limited

Burnbrae Germany East GmbH


Neunte CRSR & Co KG

Burnbrae Germany GmbH


Pathfinder Advisors Limited

Burnbrae Germany North GmbH


Podenco Distribution Limited

Burnbrae Germany South GmbH


Podenco Evissa Distribution S,L,

Burnbrae Germany West GmbH


Podenco Global Limited

Burnbrae Group Limited


Port Erin Biopharma Investments Limited

Burnbrae Kreutzberg GmbH


SCI Burnbrae Paris

Burnbrae Limited


Scotsdale Properties Limited

Burnbrae Lutzowstrasse GmbH


Sechste CRSR & Co KG

Burnbrae Media Holdings Limited


Shellbay Investments Limited

Burnbrae Media Investments Limited


Sleepwell Aviation Limited

Burnbrae Media Services Limited


Sleepwell Construction Management Limited

Burnbrae Mitte GmbH


Sleepwell Hotels (UK) Limited (Isle of Man)

Burnbrae Prenlauer Berg GmbH


Sleepwell Hotels (UK) Limited (UK)

Burnbrae Residential GmbH


Sleepwell Hotels Limited

Burnbrae Sachsen GmbH


Softline Distribution Limited

Burnbrae Schonefeld GmbH


Softline Limited

Burnbrae Spain SL


Softline UK Limited

Burnbrae Spandau GmbH


Stonehaven Properties Limited

Burnbrae Style Limited


Technical Facilities & Services Limited

Burnbrae Tempelhof GmbH


Teviot Company Limited

Burnbrae Tiergarten GmbH


The Executive Club Limited

Burnbrae Wedding GmbH


Transbank Card Services Limited

Burnbrae Wilmersdorf GmbH


Transbank Limited

Burrow Head Limited


TransSend Card Services Limited

Calabrese Holdings Limited


TransSend Holdings Limited

Chester House Property Limited


TransSend Payments Limited

Clean Air Capital Limited


Troon Properties Limited

Clean Air Capital Services Limited


Watch&Wager.com Limited

Conister Bank Limited


Watch&Wager.com LLC

Conister Card Services Limited


Webis Holdings plc

Corporate Asset Finance Limited


Wielandstrasse 5 Objekt GmbH

CRSR GmbH & Co KG


Zweite CRSR & Co KG




 

Past Directorships

(in the last five years)



Spreadbet Magazine Limited

Speymill Property Group (UK) Limited

Oilbarrel.com Limited

Speymill plc

Sharecrazy.com Limited

Rivington Street Holdings plc

ARBB AG

OKYO Pharma Limited (formerly West African Minerals Corporation)

 

On 3 September 2015, Speymill plc, a company of which Denham Eke was a director at the time, entered into a voluntary liquidation and was subsequently dissolved on 6 July 2017.  Mr Eke was also a director of subsidiary company Speymill Contracts Limited within one year of it entering into administration on 16 December 2012 and a director of Speymill Property Group (UK) Limited which entered into voluntary liquidation on 25 January 2016.  The combined creditors of Speymill plc and its subsidiaries were owed approximately £4.3 million, of which Galloway Limited, a company of which Denham Eke is a director, was owed £3.9 million.

On 29 January 2014, Rivington Street Holdings plc, a company of which Denham Eke was a director at the time, entered into a voluntary liquidation and was subsequently dissolved on 20 October 2017. The combined creditors of the company and its subsidiaries were owed approximately £4.0 million, of which Galloway Limited, a company of which Denham Eke is a director, was owed £3.8 million.

Interests in the Company

Mr Eke has no direct shareholding in the Company.

Mr Eke is the sole director of Galloway Limited which holds 370,370 Ordinary Shares (representing approximately 1 per cent. of the Company's issued share capital).  Galloway Limited is indirectly wholly owned by the trustee of a settlement under which James Mellon has a life interest.

 

There is no other information that is required to be disclosed with regards to the appointment of Mr. Eke pursuant to Schedule 2 paragraph (g) of the AIM Rules for Companies.


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 [email protected] or visit www.rns.com.
 
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