THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED IN IT IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO THE UNITED STATES, Australia, Canada, Japan, New Zealand or South Africa and SHOULD NOT BE DISTRIBUTED IN, FORWARDED TO OR TRANSMITTED INTO ANY JURISDICTION WHERE TO DO SO MIGHT CONSTITUTE A VIOLATION OF LOCAL APPLICABLE SECURITIES LAWS OR REGULATIONS. please see the important information at the end of the summary.
5 February 2010
Blacks Leisure Group plc ("Blacks Leisure" or the "Company")
Proposed Placing and Open Offer and Firm Placing to raise £22 million gross proceeds
The Board of Blacks Leisure, one of the leading retailers of outdoor specialist clothing in the UK, today announces that it proposes to raise approximately £20.28 million (net of expenses) by way of a Placing and Open Offer of 20,370,371 New Ordinary Shares and a Firm Placing of 20,370,371 New Ordinary Shares in each case at the Issue Price of 54 pence per New Ordinary Share. In aggregate, 40,740,742 New Ordinary Shares are proposed to be issued through the Proposals.
The Prospectus containing details of the Proposals and notice of the General Meeting to approve certain matters necessary to implement the Proposals is expected to be posted to Shareholders shortly and will be available on the Company's website, www.blacksleisure.co.uk.
Highlights
· Proposed Placing and Open Offer and Firm Placing to raise approximately £20.28 million (net of expenses).
· Issue Price of 54 pence per New Ordinary Share represents a discount of 4.4 per cent. to the closing middle market price of the Ordinary Shares on 4 February 2010 (being the last Dealing Day prior to this Announcement).
· The Placing and Open Offer and Firm Placing are conditional, inter alia, upon the approval of Shareholders at a General Meeting to be held at 11.00 a.m. on 24 February 2010.
· The net proceeds of £20.28 million will be used by management to accelerate the implementation of its Turnaround Plan by providing additional funding to allow the opening of new Outdoor stores, to accelerate the refurbishment of existing stores and to cancel the Group's seasonal peak working capital facility of £7.5 million.
· The Placing and Open Offer and Firm Placing will be fully underwritten by Singer Capital Markets Limited, which is acting as sole financial adviser, sponsor and broker to the Company.
· Admission of the New Ordinary Shares to listing on the Official List and to trading on the London Stock Exchange's main market for listed securities is expected to take place on 25 February 2010.
Commenting on the Proposals, Neil Gillis, Chief Executive said:
"The fund raising proposals being announced today will enable us to pursue the crucial growth phase of our recovery plan. The proceeds will underpin a selective expansion of our outdoor retail estate by the addition of up to 35 new stores, in towns where we have previously traded successfully or which currently lack an outdoor retail offer, and accelerate the refurbishment of our core estate which has suffered from years of underinvestment. With a clear and well financed recovery plan now in place, Blacks Leisure is in a stronger position than it has been for a number of years to realise the potential of its market leadership position in outdoor retail and deliver returns to shareholders."
This summary should be read in conjunction with the full text of this Announcement. Appendix I contains an expected timetable of key events. Appendix II contains the definitions of certain terms used in this Announcement.
A copy of the Prospectus, following publication, will be available from the registered office of the Company at 440-450 Cob Drive, Swan Valley, Northampton NN4 9BB and on the Company's website at www.blacksleisure.co.uk. The Prospectus will also, following publication, be available for inspection during normal business hours on any weekday (Saturdays, Sundays and public holidays excluded) at the offices of Singer Capital Markets Limited, One Hanover Street, London W1S 1YZ.
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For further information, please contact:
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Blacks Leisure Group plc
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01604 597 222
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Neil Gillis, Chief Executive
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Citigate Dewe Rogerson
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020 7638 9571
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Simon Rigby
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Kevin Smith
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Singer Capital Markets
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020 3205 7500
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Jeff Keating
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Jos Trusted
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Singer Capital Markets, which is authorised and regulated in the United Kingdom by the Financial Services Authority, is acting exclusively for the Company and for no one else in relation to the Proposals and the arrangements referred to in this Announcement. Singer Capital Markets will not regard any other person as its client in relation to the Proposals and will not be responsible to anyone other than the Company for providing the protections afforded to clients of Singer Capital Markets or for providing any advice in relation to the Proposals, the contents of this Announcement or any transaction or arrangement referred to herein.
THIS ANNOUNCEMENT AND THE INFORMATION CONTAINED IN IT IS NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN WHOLE OR IN PART, IN OR INTO THE UNITED STATES, Australia, Canada, Japan, New Zealand or South Africa and SHOULD NOT BE DISTRIBUTED IN, FORWARDED TO OR TRANSMITTED INTO ANY JURISDICTION WHERE TO DO SO MIGHT CONSTITUTE A VIOLATION OF LOCAL APPLICABLE SECURITIES LAWS OR REGULATIONS.
5 February 2010
Blacks Leisure Group plc ("Blacks Leisure" or the "Company")
Proposed Placing and Open Offer and Firm Placing to raise £22 million gross proceeds
1. Introduction
The Board of Directors of Blacks Leisure announces today that it proposes to undertake a Placing and Open Offer and a Firm Placing to raise approximately £20.28 million (net of expenses) through the issue of 40,740,742 New Ordinary Shares at an Issue Price of 54 pence per New Ordinary Share. 20,370,371 New Ordinary Shares will be issued through the Placing and Open Offer and 20,370,371 New Ordinary Shares will be issued through the Firm Placing.
The Issue Price for the Placing and Open Offer and Firm Placing represents a discount of 2.5 pence to the closing middle market price of the Ordinary Shares on 4 February 2010 (being the last Dealing Day prior to this Announcement). In setting the Issue Price, the Directors have considered the price at which the New Ordinary Shares need to be offered to investors to ensure the success of the Placing and Open Offer and Firm Placing and raise a very significant level of equity compared to the market capitalisation of the Company. The Directors believe that both the Issue Price and the discount are appropriate.
2. Information on the Group
The Company is listed on the Official List and is one of the leading retailers of outdoor specialist clothing and equipment in the UK. The Group operates 313 stores which are located across the British Isles in two markets under three different high street trading brands. The core Outdoor division operates under the Millets (208 stores) and Blacks (92 stores) fascias. The Boardwear division, which now only accounts for approximately 5 per cent. of total sales from the Group's ongoing estate, operates under the Freespirit (13 stores) fascia. The Group also has several transactional websites, including at www.blacks.co.uk and www.millets.co.uk, accounting for approximately 2.8 per cent. of the total sales of the Group in the ten month period to 31 December 2009. The Group employs over 3,500 people in its stores and approximately 450 people at its head office and distribution centre. The Outdoor division sells branded goods from key suppliers such as The North Face, Berghaus and Merrell as well as developing and selling its own specialist brands such as Peter Storm, Eurohike and ALS. The Boardwear division retails brands such as Quiksilver, Roxy and Oakley alongside its own branded Freespirit clothing and accessories.
3. Background to and reasons for the Proposals
Background
The Group's business had been profitable for many years, but in 2006 the Group's performance declined to a loss-making position despite relatively favourable economic conditions. Several components propelled the business from profitability into loss-making, including:
• opening larger out-of-town stores whose sales did not support the higher costs incurred;
• continued operation of the Boardwear division;
• a lack of investment in the core estate; and
• increased costs arising, in part, from the establishment of e-commerce operations and a new
centralised distribution centre.
Turnaround Plan
Addressing these issues has been the key focus for the current management over the last 18 months. Although the Group has had some success in this regard, economic conditions since 2008 and a continuing decline in the Boardwear division contributed to an ongoing decline in the Group's performance. The current senior management team began to be appointed in November 2007. Under the leadership of Neil Gillis it devised the Turnaround Plan, which represented a completely different strategy to that previously pursued and which has thus far succeeded in reversing some of the Group's problems.
The Turnaround Plan was to be effected through three phases and sought to achieve the following objectives:
• an exit from the loss-making Boardwear division;
• a rationalisation of the cost base;
• an improvement in basic retail skills to improve performance of the stores; and
• investment in the store portfolio.
Phases I and II of the Turnaround Plan have been completed. Phase I achieved, amongst other things, a rationalisation of the cost base, an improvement in core retail skills, a reduction in working capital requirements and the closure of the O'Neill offices and warehouse (forming part of the Boardwear division) and the integration of the O'Neill operations into the Group's existing infrastructure. The reduction of approximately 29 per cent. of head office roles was also commenced.
During Phase II, management terminated the O'Neill wholesale business, closed 87 stores, converted eight Boardwear stores into the Blacks format, placed Sandcity (which operated 11 O'Neill stores) into administration, entered into the New Facility Agreement and on 22 December 2009 implemented the CVAs. Under the CVAs the claims of landlords of 101 of the Group's leases relating to properties which were closed or to be closed were compromised and the terms of 291 leases of the remaining 313 of the Group's retail stores were varied so that rent, service charge and insurance would be paid on a monthly rather than quarterly basis for a period of 18 months. In connection with the CVAs, provision has been made for, in aggregate, approximately £20 million of associated costs. These costs are unaudited and subject to review in the preparation of the year end financial statements.
Future Strategy
Against the background of the strong recent trading results of the Outdoor division and the positive impact of the CVAs, the Directors believe that the Group's recovery prospects have been significantly enhanced such that it would now benefit from additional funding to enable it to accelerate the implementation of Phase III of the Turnaround Plan. The detailed strategy for Phase III is as follows:
• implementing up to 35 new Outdoor store openings, particularly in areas where the Group has
recently exited over-rented stores but where there was a history of strong sales but also in towns
without any outdoor offering;
• rolling out a refurbishment programme based on the proven new store formats to upgrade the existing estate;
• optimizing the use of the two main fascias - Blacks and Millets - by ensuring the most profitable fascia is used in the correct location and by continuing to re-establish the distinctive positions of each fascia by emphasising the expert, branded and premium character of Blacks and the family value and own label nature of the Millets offering;
• further reducing costs by sub-contracting parts of the distribution function;
• developing the Group's e-commerce operations; and
• maintaining the remaining Boardwear division.
The Board has decided that it is in the best interests of the Company and Shareholders as a whole to raise approximately £20.28 million (net of expenses) of new equity capital. The Directors believe the additional equity will facilitate a more rapid execution of Phase III of the Turnaround Plan, in particular, the opening of new stores and the refurbishment of existing ones. It will also provide further cash to the business, thereby giving sufficient additional working capital to cancel Facility B (which is more costly than the Group's £35 million core facility) which in turn will reduce financing costs going forward.
4. Use of Proceeds
The net proceeds of the Placing and Open Offer and Firm Placing are anticipated to be approximately £20.28 million. They will be used to facilitate a more rapid execution of Phase III of the Turnaround Plan as follows:
• £ 8.97 million to fund the opening of up to 15 new Outdoor stores by 28 February 2011 and up to a further 20 new Outdoor stores by 29 February 2012, predominantly in areas where the Group exited loss-making stores which had high rents but significant and consistent sales but also in towns without any outdoor offering;
• £6.60 million to accelerate the previously planned programme to enable investment in the existing store portfolio by the refurbishment of up to 130 existing stores by 28 February 2012; and
• £4.71 million for additional working capital purposes to enable the Company to cancel Facility B (which is more expensive than the Company's £35 million core facility).
The Directors believe that an investment programme can achieve a better return from a focused deployment of investment: traditionally, 49 per cent. of profit has come from the top 20 per cent. of stores, while 75 per cent. of profit has come from the top 40 per cent. of stores.
5. Current Trading and Prospects
Notwithstanding the significant restructuring which the Group has implemented since 29 August 2009,trading since that date has been very healthy, with like-for-like sales from the ongoing stores increasing by 12.0 per cent. Within this figure, the core Outdoor division performed particularly strongly, with like-for-like sales increasing by 13.1 per cent. The Boardwear division recorded a like-for-like decrease of 4.4 per cent.
Total Group sales in the period were £98.9 million, compared to £102.0 million in the prior period. This reduction is largely as a result of the store closures and the placing into administration of Sandcity. Gross margin for the ongoing stores since 29 August 2009 has remained broadly in line with that reported for the whole business in the first half of the current financial year. The Group delivered a very strong performance over the Christmas peak trading period. In the six weeks ended 7 January 2010 like-for-like sales from the ongoing stores increased by 15.2 per cent. over the previous year and have been ahead of the previous financial year for each month since the formal restructuring began to be implemented in September 2009 during more clement weather.
With a combination of recent improved trading, a stronger store portfolio and a leading position in the Outdoor goods market, the Board believes that, despite the uncertain economic outlook for this year, the longer term prospects for the Group are very positive.
6. The Placing and Open Offer and Firm Placing
Under the terms of the Open Offer, Qualifying Shareholders (other than, subject to certain exceptions, Overseas Shareholders with registered addresses in the United States or the Excluded Territories and US persons) will be given the opportunity to apply for Open Offer Shares at a price of 54 pence per Open Offer Share, free of expenses, payable in full in cash on application, on the basis of:
0.4777504 Open Offer Shares for every 1 existing Ordinary Share
held by Qualifying Shareholders at the Record Date and so on in proportion for any other number of Ordinary Shares then held.
Provided that they take up their Open Offer Entitlements in full, Qualifying Shareholders are also being given the opportunity to apply for Excess Shares, subject to availability, through the Excess Application Facility, up to a maximum number of Excess Shares equal to 0.4777504 times the number of Existing Ordinary Shares held in such Qualifying Shareholder's name as at the Record Date. This will enable Qualifying Shareholders (subject to availability) to mitigate the dilution of their existing shareholdings arising from the Firm Placing. Excess Shares will become available as part of the Open Offer where Open Offer Entitlements are not fully taken up in full by Qualifying Shareholders.
The Company also proposes to issue 20,370,371 New Ordinary Shares pursuant to the Firm Placing. The Excess Application Facility will give Qualifying Shareholders, subject to availability, the opportunity to mitigate the dilution of existing Shareholders arising from the Firm Placing. However, the extent to which such dilution will be capable of being mitigated will depend upon the level of Open Offer Entitlements which are not taken up by Qualifying Shareholders
The Company has entered into the Placing Agreement pursuant to which Singer Capital Markets has agreed to procure conditional placees for the Firm Placed Shares at the Issue Price, such Firm Placees to comprise institutional and other investors. Singer Capital Markets has also agreed to procure conditional placees to comprise institutional and other investors for the Open Offer Shares, subject to clawback to satisfy valid applications under the Open Offer from Qualifying Shareholders. Singer Capital Markets (or its nominee) will, to the extent that it does not procure placees for all the Firm Placed Shares and conditional placees for all the Open Offer Shares not applied for under the Open Offer, subscribe for such New Ordinary Shares itself. Accordingly, the Placing and Open Offer and Firm Placing are fully underwritten.
The Placing and Open Offer and Firm Placing are conditional upon:
• the passing of the Resolution to be proposed at the General Meeting;
• Admission becoming effective by not later than 8.00 a.m. on 25 February 2010 (or such later time and/or date as Singer Capital Markets and the Company may agree, not being later than 5.00 p.m. on 24 March 2010); and
• the Placing Agreement becoming unconditional in all respects and not having been terminated prior to Admission.
7. General Meeting
The Company is required to obtain Shareholder approval for the granting of authority to allot the New Ordinary Shares on a non-pre-emptive basis. A General Meeting is therefore to be held at 11.00 a.m. on 24 February 2010 at the offices of Travers Smith LLP at 10 Snow Hill, London EC1A 2AL, for the purpose of considering and, if thought fit, passing the Resolution.
Further details relating to the General Meeting are contained within the Prospectus.
8. Recommendation
The Board, which has received financial advice in relation to the Proposals from Singer Capital Markets, considers that the Proposals and the Resolution are in the best interests of the Company and its Shareholders as a whole.
In providing this advice, Singer Capital Markets has taken into account the Board's commercial assessment of the Proposals.
Accordingly, the Board will unanimously recommend that Shareholders vote in favour of the Resolution, as the Directors intend to do, or procure, in respect of their own beneficial holdings which comprise a total of 378,926 Ordinary Shares, representing approximately 0.9 per cent. of the Company's current issued share capital.
9. Further Information
Further details relating to the Proposals will be contained in the Prospectus that is expected to be published shortly. After publication, copies of the Prospectus will be available for inspection at the registered office of the Company at 440-450 Cob Drive, Swan Valley, Northampton NN4 9BB and on the Company's website at www.blacksleisure.co.uk. The Prospectus will also, following publication, be available for inspection during normal business hours on any weekday (Saturdays, Sundays and public holidays excluded) at the offices of Singer Capital Markets Limited, One Hanover Street, London W1S 1YZ.
Copies of the Prospectus, the Notice of General Meeting, the Form of Proxy and the Application Form will also, following publication, be available for inspection at the UK Listing Authority's Document Viewing Facility situated at the Financial Services Authority, 25 The North Colonnade, Canary Wharf, London E14 5HS.
This Announcement has been issued by and is the sole responsibility of the Company. No representation or warranty, express or implied is, or will be made as to, or in relation to, and no responsibility or liability is, or will be, accepted by Singer Capital Markets or by any of its affiliates or agents as to, or in relation to, the accuracy or completeness or fairness of this Announcement or any other written or oral information made available to or publicly available to any interested party or its advisers, and any responsibility or liability for any such information or opinions or for any errors or omissions is expressly disclaimed.
This Announcement contains forward looking statements, which are based on the Board's current expectations and assumptions and involve known and unknown risks and uncertainties that could cause actual results, performance or events to differ materially from those expressed or implied in such statements. It is believed that the expectations reflected in these statements are reasonable, but they may be affected by a number of variables which could cause actual results or trends to differ materially, including, but not limited to: a reduction in demand by customers; the limitations of the Group's internal financial reporting controls; an increase in competition; an unexpected decline in turnover; legislative, fiscal and regulatory developments, including, but not limited to, changes in environmental and safety regulations; currency and interest rate fluctuations and the adoption of International Financial Reporting Standards (IFRS). Each forward looking statement speaks only as of the date of the particular statement.
Except as required by the Listing Rules, the Disclosure and Transparency Rules, the Prospectus Rules, the London Stock Exchange or otherwise by law, the Company expressly disclaims any obligation or undertaking to release publicly any updates or revisions to any forward looking statements contained herein to reflect any change in the Company's expectations with regard thereto or any change in events, conditions or circumstances on which any such statement is based.
No statement in this Announcement is, or is intended to be, a profit forecast and no statement in this Announcement should be interpreted to mean that earnings per share of Blacks for the current or future financial years would necessarily match or exceed the historical published earnings per share of Blacks.
This Announcement is an advertisement. It is not a prospectus. Investors should not subscribe for or purchase any shares referred to in this Announcement except SOLELY on the basis of information in the prospectus to be published by blacks leisure group plc in connection with the proposed placing and open offer and firm placing. Copies of the prospectus will, following publication, be available from the company's registered office and, OTHER THAN IN CERTAIN JURISDICTIONS, on its CORPORATE website at
www.blacksleisure.co.uk.
Neither the content of Blacks Leisure's website nor any website accessible by hyperlinks on Blacks Leisure's website is incorporated in, or forms part of, this Announcement.
This Announcement is for information only and does not constitute or form part of any offer or invitation to issue, acquire or dispose of any securities or investment advice in any jurisdiction. In particular this Announcement does not contain or constitute an offer of, or the solicitation of an offer to buy or subscribe for, the New Ordinary Shares or any other securities to any person in Australia, Canada, Japan, New Zealand or South Africa, or the United States or in any jurisdiction to whom or in which such offer or solicitation is unlawful. Subject to certain exceptions, the securities referred to herein may not be offered or sold in Australia, Canada, Japan or South Africa or to, or for the account or benefit of, any national, resident or citizen of Australia, Canada, Japan or South Africa. The offer and sale of the securities referred to herein has not been and will not be registered under the US Securities Act or under the applicable securities laws of Australia, Canada, Japan or South Africa. The availability of the Placing and Open Offer and Firm Placing to persons not resident in the United Kingdom may be affected by the laws of the relevant jurisdictions. Such persons should inform themselves about and observe any application requirements.
The New Ordinary Shares have not been and will not be registered under the US Securities Act or under the securities laws of any state or other jurisdiction of the United States or under any securities laws of Australia, Canada, Japan or South Africa or any other jurisdiction where to do so would be unlawful and may not be offered, sold, taken up, exercised, resold, renounced, transferred or delivered, directly or indirectly, within the United States, or within any of Australia, Canada, Japan or South Africa or any other jurisdiction where to do so would be unlawful. There will be no public offer of the New Ordinary Shares in the United States.
The distribution of this Announcement and the offering of the New Ordinary Shares in jurisdictions other than the United Kingdom may be restricted by law. No action has been taken by the Company or Singer Capital Markets that would permit an offering of such shares or possession or distribution of this Announcement or any other offering or publicity material relating to such shares in any jurisdiction where action for that purpose is required. Persons into whose possession this Announcement comes are required by the Company and Singer Capital Markets to inform themselves about, and to observe, any such restrictions. Any failure to comply with these restrictions may constitute a violation of the securities laws of any such jurisdiction.
Appendix I
Expected Timetable of Events
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Record Date for the Open Offer
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close of business on 3 February 2010
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Ex-entitlement Date for the Open Offer
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(expected to be) 5 February 2010
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Announcement of the Proposals and despatch of Prospectus, Forms of Proxy and Application Forms
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5 February 2010
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Open Offer Entitlements and Excess Open Offer Entitlements credited to stock accounts in CREST of Qualifying CREST Shareholders
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as soon as possible after
8.00 a.m. on 8 February 2010
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Recommended latest time for requesting withdrawal of Open Offer Entitlements and Excess Open Offer Entitlements from CREST
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4.30p.m. on 16 February 2010
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Latest time and date for depositing Open Offer Entitlements and Excess Open Offer Entitlements into CREST
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3.00p.m. on 17 February 2010
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Latest time and date for splitting Application Forms (to satisfy bona fide market claims)
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3.00p.m. on 18 February 2010
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Latest time and date for receipt of Forms of Proxy, electronic proxy appointments via the CREST system and other bon-CREST electronic proxies for use at the General Meeting
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11.00 a.m. on 22 February 2010
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Latest time and date for receipt of completed Application Forms and payment in full under the Open Offer and settlement of relevant CREST instructions (as appropriate)
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11.00a.m. on 22 February 2010
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General Meeting
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11.00a.m. on 24 February 2010
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Dealings in the New Ordinary Shares commence
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8.00a.m. on 25 February 2010
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Expected date for crediting of New Ordinary Shares to CREST stock accounts
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25 February 2010
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Despatch of share certificates for New Ordinary Shares in certificated form
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4 March 2010
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Appendix II
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Definitions
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"Admission"
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the admission of New Ordinary Shares (i) to the Official List and (ii) to trading on the London Stock Exchange's market for listed securities becoming effective in accordance with the Listing Rules and the Admission and Disclosure Standards the requirements contained in the publication "Admission and Disclosure Standards" dated September 2009 containing, amongst other things, the admission requirements to be observed by companies seeking admission to trading on the London Stock Exchange's market for listed securities
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"Announcement"
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this announcement
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"Application Form"
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the application form for Qualifying non-CREST Shareholders for use in connection with the Open Offer
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"Board"
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the board of Directors of the Company
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"Boardwear"
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the sector of the Group's business (predominantly trading under the Freespirit fascia) concentrated on board sports and the provision of casual lifestyle clothing and accessory brands such as Oakley, Quiksilver, Freespirit and O'Neill
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"BoS"
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Bank of Scotland plc
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"certificated" or "certificated form"
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not in uncertificated form
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"Company" or "Blacks Leisure"
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Blacks Leisure Group plc
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"CREST"
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the relevant system for the paperless settlement of trades and the holding of uncertificated securities operated by Euroclear UK & Ireland in accordance with the Regulations
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"CVAs"
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the company voluntary arrangements of each of Blacks Leisure and TOG which were implemented on 22 December 2009
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"Dealing Day"
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any day on which the London Stock Exchange is open for business in the trading of securities admitted to the Official List.
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"Directors"
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the directors of the Company at the date of this Announcement
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"Euroclear UK & Ireland"
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Euroclear UK & Ireland Limited, the operator of CREST
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"Excess Application Facility"
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the arrangement pursuant to which Qualifying Shareholders will be able to apply (subject to availability) for Open Offer Shares in excess of their Open Offer Entitlement (up to a maximum number of Open Offer Shares equal to 0.4777504 times the number of Existing Ordinary Shares held in such Qualifying Shareholder's name as at the Record Date) provided they have agreed to take up their Open Offer Entitlement in full
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"Excess Open Offer Entitlement"
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in respect of each Qualifying Shareholder, the entitlement (in addition to his or her Open Offer Entitlement) to apply, subject to availability, for Open Offer Shares up to 0.4777504 times the number of existing Ordinary Shares held in his or her name as at the Record Date, pursuant to the Excess Application Facility, which will be conditional on such Qualifying Shareholder agreeing to take up their Open Offer Entitlement in full and which may be subject to scaling back
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"Excess Shares"
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New Ordinary Shares for which Qualifying Shareholders may apply under the Excess Application Facility
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"Excluded Territories"
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Australia, Canada, Japan, New Zealand and the Republic of South Africa
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"Facility B"
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the £7,500,000 'seasonal peak' working capital facility available under the New Facility Agreement
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"Firm Placees"
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any persons who have agreed or shall agree to subscribe for Firm Placed Shares pursuant to the Firm Placing
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"Firm Placed Shares"
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in aggregate 20,370,371 New Ordinary Shares which the Company is proposing to allot and issue pursuant to the Firm Placing
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"Firm Placing"
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the subscription by the Firm Placees for the Firm Placed Shares
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"FSA"
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the Financial Services Authority
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"General Meeting"
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the general meeting of the Company to be convened for 24 February 2010, notice of which will be contained within the Prospectus
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"Group"
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the Company and its subsidiary undertakings
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"Issue Price"
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54 pence per New Ordinary Share
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"Listing Rules"
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the rules and regulations made by the FSA under Part VI of the Financial Services and Markets Act 2000 (as amended from time to time)
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"London Stock Exchange"
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London Stock Exchange plc
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"New Facility Agreement"
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the £42,500,000 revolving credit facility agreement entered into between the Company, certain of its subsidiaries and BoS on 2 November 2009
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"New Ordinary Shares"
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40,740,742 New Ordinary Shares to be issued pursuant to the Placing and Open Offer and Firm Placing
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"Official List"
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the Official List of the UK Listing Authority
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"Open Offer"
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the offer to Qualifying Shareholders to subscribe for New Ordinary Shares, including pursuant to the Excess Application Facility, at the Issue Price
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"Open Offer Entitlement"
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an offer to a Qualifying Shareholder pursuant to the Open Offer to subscribe for 0.4777504 New Ordinary Shares for every existing Ordinary Share held by such Qualifying Shareholder on the Record Date, on and subject to the terms of the Open Offer but excluding the offer under the Excess Application Facility
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"Open Offer Shares"
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the 20,370,371 New Ordinary Shares for which Qualifying Shareholders will be invited to apply under the terms of the Open Offer
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"Ordinary Shares"
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ordinary shares of 1 penny each in the capital of the Company
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"Outdoor"
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the sector of the Group's business concentrating on the provision of outdoor activity clothing and equipment including walking and camping
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"Overseas Shareholders"
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Shareholders who are resident in, or who are citizens of, or who have registered addresses in, territories other than the United Kingdom and Shareholders who are US persons
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"Placing"
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the conditional placing by Singer Capital Markets on the Company's behalf of the New Ordinary Shares pursuant to the Placing Agreement
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"Placing Agreement"
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the agreement dated 5 February 2010 between the Company and Singer Capital Markets relating to the Placing and Open Offer and Firm Placing
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"Proposals"
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the Placing and Open Offer and the Firm Placing
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"Prospectus Rules"
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the rules and regulations made by the FSA under Part VI of the Financial Services and Markets Act 2000 (as amended from time to time)
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"Qualifying CREST Shareholders"
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Qualifying Shareholders whose Ordinary Shares on the register of members of the Company at the close of business on the Record Date are in uncertificated form
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"Qualifying Non-CREST Shareholders"
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Qualifying Shareholders whose Ordinary Shares on the register of members of the Company at the close of business on the Record Date are in certificated form
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"Qualifying Shareholders"
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holders of Ordinary Shares on the Company's register of members at the Record Date (other than certain Overseas Shareholders)
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"Record Date"
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close of business on 3 February 2010
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"Regulations"
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the Uncertificated Securities Regulations 2001 (as amended from time to time)
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"Resolution"
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the resolution to be set out in the notice of General Meeting contained within the Prospectus
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"Sandcity"
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Sandcity Limited
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"Shareholders"
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holders of Ordinary Shares
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"Singer Capital Markets"
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Singer Capital Markets Limited whose office is at One Hanover Square, London W15 1YZ
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"£"
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pounds sterling
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"stock account"
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an account within a member account in CREST to which a holding of a particular share or other security in CREST is credited
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"TOG"
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The Outdoor Group Limited
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"Turnaround Plan"
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the three phase turnaround plan initiated by the Board in 2008 in order to exit the loss-making Boardwear sector, rationalise the Group's cost base, improve basic retail skills, and address underinvestment in the core estate of the Group
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"UK Listing Authority"
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the FSA in its capacity as competent authority under the Financial Services and Markets Act 2000
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"uncertificated" or "uncertificated form"
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recorded on the relevant register or other record of the share or other security concerned as being held in uncertificated form in CREST, and title to which, by virtue of the Regulations, may be transferred by means of CREST
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"United Kingdom" or "UK"
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the United Kingdom of Great Britain and Northern Ireland
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"United States" or "US"
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the United States of America, its territories and possessions and any state of the United States and the District of Columbia
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"US person"
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has the meaning provided in section 902(k) of Regulation S under the US Securities Act
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"US Securities Act"
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the United States Securities Act of 1933 (as amended)
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