Acquisition of Customised Packaging Limited

RNS Number : 9347Q

Coral Products PLC

03 March 2021

 

Coral Products PLC

(the "Company", the "Group" or "Coral")

Acquisition of Customised Packaging Limited

Coral Products plc, a specialist in the design, manufacture and supply of plastic products based in Wythenshawe, Manchester, is pleased to announce that it has acquired the entire issued share capital of Customised Packaging Limited ("CPL") for a net consideration of £1.25 million ("Acquisition"), comprising £883,956.25 to be satisfied in cash and £366,043.75 to be satisfied by the issue of 3,327,669 new ordinary shares to the vendors of CPL ("Vendors") at a price of 11 pence per share ("Consideration Shares").

The cash consideration for the Acquisition is being satisfied from Group's existing resources.

In addition to the consideration of £1.25 million detailed above, an earn-out consideration shall become payable to the Vendors in the event that CPL's profit before tax for the year ended 31 December 2021 ("2021 PBT") is greater than two hundred and fifty thousand pounds ("Earn-Out Consideration").  If triggered, the Earn-Out Consideration shall be equivalent to 30% of profits in excess of two hundred and fifty thousand pounds for the period 1 January 2021 to 31 December 2021 (capped to £250,000) and shall be payable by the date no more than 20 business days after the date on which 2021 profit before taxation is agreed ("Due Date").

CPL designs, manufactures and supplies plastic products using their top of the range sheet extrusion technology and vacuum forming capability to a range of a blue-chip customer's own design specifications.  CPL, which is based in Manchester will continue to operate from its existing premises.

As per the unaudited management accounts, in the year ended 31 December 2020, CPL's sales were circa £2.3 million and the net asset value was £0.7 million.  Pursuant to the terms of the share purchase agreement, the Vendors have given warranties and indemnities in favour of the Company.

Admission and Total Voting Rights

Application will be made to the London Stock Exchange to admit the Consideration Shares to trading on AIM. Admission of the Consideration Shares is expected to occur on or around 8 March 2021 ("Admission").  The new ordinary shares will rank pari passu with the existing ordinary shares.

In conformity with DTR 5.6.1, the Company notifies that, as at the date of this announcement, it has a single class of shares in issue being Ordinary Shares and the total number of Ordinary Shares in issue is currently 82,614,865 .

There are no Ordinary Shares held in treasury. Each Ordinary Share entitles the holder to a single vote at general meetings of the Company.  Following Admission, the enlarged issued share capital of the Company will comprise 85,942,534 ordinary shares of 1 pence each.

Joe Grimmond, Chairman of the Company, commented: "The acquisition of CPL is a significant milestone for Coral as it expands further the Group's market coverage and product range. The Board anticipates that the Acquisition will be earnings enhancing in its first year."

For more information on Coral and CPL, please visit the following websites:

www.coralproducts.com  

www.customisedpackaging.co.uk

This announcement contains inside information for the purposes of UK Market Abuse Regulation and has been arranged for release by Sharon Tinsley, Finance Director of the Company. The Directors of the Company are responsible for the release of this announcement.

For further information, please contact:

Coral Products plc Joe Grimmond, Executive Chairman	Tel: [phone]
Nominated Adviser & Broker Cairn Financial Advisers LLP Liam Murray Sandy Jamieson David Lawman (Corporate Broking)	Tel: [phone]
Capital Markets Consultants Limited Richard Pearson	Tel: [phone]

This announcement contains unaudited information and forward-looking statements that are based on current expectations or beliefs, as well as assumptions about future events. These forward-looking statements can be identified by the fact that they do not relate only to historical or current facts and undue reliance should not be placed on any such statement because they speak only as at the date of this document and are subject to known and unknown risks and uncertainties and can be affected by other factors that could cause actual results, and Coral's plans and objectives, to differ materially from those expressed or implied in the forward-looking statements. Coral undertakes no obligation to revise or update any forward-looking statement contained within this announcement, regardless of whether those statements are affected as a result of new information, future events or otherwise, save as required by law and regulations.

 

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