Result of Placing

RNS Number : 6179K

Loungers PLC

23 April 2020

 

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION AS DEFINED UNDER THE MARKET ABUSE REGULATION (EU) NO. 596/2014 AND THE INFORMATION CONTAINED HEREIN IS NOT FOR PUBLICATION, RELEASE, OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, IN, OR INTO, THE UNITED STATES, AUSTRALIA, CANADA, JAPAN, SOUTH AFRICA OR ANY JURISDICTION IN WHICH THE SAME WOULD BE UNLAWFUL. THE INFORMATION CONTAINED HEREIN DOES NOT CONSTITUTE AN OFFER OF SECURITIES FOR SALE IN THE UNITED STATES, AUSTRALIA, CANADA, JAPAN OR SOUTH AFRICA OR IN ANY OTHER JURISDICTION IN WHICH THE SAME WOULD BE UNLAWFUL

Loungers plc 

("Loungers" or the "Company")

Result of Placing

Loungers is pleased to announce the completion of the placing it launched on 22 April 2020 (the "Placing").

A total of 9,250,000 new ordinary shares of 1 pence each ("Ordinary Shares") (the "Placing Shares"), representing 10 per cent of the issued Ordinary Shares, were placed at an issue price of 90 pence per Placing Share (the "Placing Price") raising gross proceeds of approximately £8.3m for the Company. The Placing Price represents a premium of 16.1 per cent to the closing price on 22 April 2020 of 77.5 pence per Ordinary Share.

The Placing was conducted via an accelerated bookbuild process (the "Bookbuild") under the Company's existing shareholder authorities. Liberum Capital Limited and Peel Hunt LLP acted as joint bookrunners on the Bookbuild.

As outlined in the launch announcement for the Placing, the directors of the Company (the "Directors") believe that the net proceeds of the Placing (approximately £8.1m) will, when combined with its new bank facilities, provide the Company with sufficient capital to manage through the Covid-19 crisis, even in the event of a protracted period before the Government allows hospitality businesses to re-open, and to subsequently recommence its roll-out at the appropriate time.

Application has been made to the London Stock Exchange for the Placing Shares to be admitted to trading on AIM and it is anticipated that dealings in the Placing Shares will commence on AIM at 8.00 a.m. on 27 April 2020 ("Admission"). The Placing Shares will rank pari passu with the existing Ordinary Shares and will represent approximately 9.1 per cent of the Company's enlarged issued share capital on Admission (assuming no other issuance of Ordinary Shares prior to Admission).

Following Admission, the Company's issued and fully paid share capital will consist of 101,750,000 Ordinary Shares, all of which carry one voting right per share. The Company does not hold any Ordinary Shares in Treasury. The figure of 101,750,000 Ordinary Shares may be used by shareholders as the denominator for the calculation by which they will determine if they are required to notify their interest in, or a change to their interest in, the Company.

Related party transaction s

Certain Directors (the "Participating Directors") have agreed to subscribe, in aggregate, for 822,787 Placing Shares at the Placing Price. In addition, funds advised by Lion Capital LLP ("Lion") have agreed to subscribe for 3,000,114 Placing Shares at the Placing Price.

The Participating Directors (acting together) are considered to be a related party for the purposes of Rule 13 of the AIM Rules. In addition, Lion, which is currently interested in 28.9 per cent of the issued Ordinary Shares, is also a related party for the purposes of Rule 13 of the AIM Rules by virtue of being a substantial shareholder in Loungers (as defined in the AIM Rules). Robert Darwent, a non-executive Director, is a partner in Lion and is deemed to be interested in the Ordinary Shares held by Lion.

AIM Rule 13 requires that Loungers publicly disclose related party transactions and include in its disclosure a statement that those Directors who are not involved in such transactions (the "Independent Directors") consider, having consulted with Loungers' nominated adviser, that the terms are fair and reasonable so far as Loungers' shareholders are concerned (a "Directors' Opinion").

There are no Independent Directors in a position to provide a Directors' Opinion in relation to the Placing. In lieu of a Directors' Opinion, GCA Altium, in its capacity as Nominated Adviser to the Company for the purposes of the AIM Rules, considers that the participations of the Participating Directors and Lion in the Placing are fair and reasonable insofar as the shareholders of the Company are concerned.

Details of the Placing Shares for which Lion, the Participating Directors and certain other PDMRs have subscribed and their resultant holdings of Ordinary Shares are displayed below:

			Resultant Holding
Shareholder	Position	Number of Placing Shares	Number of Ordinary Shares	% of Enlarged Issued Share Capital
Director
Alex Reilley	Executive Chairman	654,675	7,201,432	7.08
Nick Collins	CEO	130,570	1,436,276	1.41
Gregor Grant	CFO	33,333	180,148	0.18
Nick Backhouse	Non-Executive	1,403	13,903	0.01
Adam Bellamy	Non-Executive	1,403	13,903	0.01
Jill Little	Non-Executive	1,403	13,903	0.01
PDMR
Jake Bishop	Commercial Director	650,675	7,157,432	7.03
Justin Carter	MD - Lounge	49,896	548,853	0.54
Amber Wood	MD - Cosy Club	11,111	29,464	0.03
Lion*		3,000,114	29,728,638	29.22

* Robert Darwent, a non-executive Director, is a partner in Lion and is deemed to be interested in the Ordinary Shares held by funds advised by Lion

Nick Collins, Chief Executive of the Company, commented:

"Having continued to outperform our market immediately prior to lock-down, we are determined to emerge strongly from this period and rebuild that momentum.

"We have taken all the self-help measures open to us and are indebted to our teams for their ongoing support and engagement in the communities which they serve. Government support is welcomed and continues to be critical to us, and the wider hospitality industry, however it is imperative this is maintained throughout the re-opening phase until consumer confidence rebuilds.

"With our newly agreed debt facilities and the successful equity fundraising, we are in a strong financial position with sufficient liquidity to come through this crisis and to take advantage of the opportunities that will emerge when restrictions are lifted."

For further information please contact:

Loungers plc Nick Collins, Chief Executive Officer Gregor Grant, Chief Financial Officer

Via Instinctif Partners

GCA Altium Limited (Financial Adviser and NOMAD) Sam Fuller / Tim Richardson		Tel: [phone]
Liberum Capital Limited (Joint Broker) Andrew Godber / John Fishley		Tel: [phone]
Peel Hunt LLP (Joint Broker) Dan Webster / George Sellar		Tel:  [phone]
Instinctif Partners (Financial Public Relations) Justine Warren / Matthew Smallwood	Tel: [phone] / 2005

This Announcement is released by Loungers and contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) 596/2014 (MAR), and is disclosed in accordance with the Company's obligations under Article 17 of MAR. For the purposes of MAR and Article 2 of Commission Implementing Regulation (EU) 2016/1055, this announcement is being made on behalf of the Company by Nick Collins, Chief Executive Officer.

About Loungers

Loungers operates through its two complementary brands - Lounge and Cosy Club - in the UK hospitality sector.  A Lounge is a neighbourhood café/bar combining elements of coffee shop culture, the British pub and dining.  As at 20 March 2020, there were 138 Lounges nationwide. Lounges are principally located in secondary suburban high streets and small town centres. The sites are characterised by informal, unique interiors with an emphasis on a warm, comfortable atmosphere, often described as a "home from home".

Cosy Clubs are more formal bars/restaurants offering reservations and table service but share many similarities with the Lounges in terms of their broad, all-day offering and their focus on hospitality and their culture.  Cosy Clubs are typically located in city centres and large market towns. Interiors tend to be larger and more theatrical than for a Lounge, and heritage buildings or first-floor spaces are often employed to create a sense of occasion.  As at 20 March 2020, there were 29 Cosy Clubs nationwide.

IMPORTANT NOTICE

This Announcement does not constitute or form part of an offer to sell or issue or a solicitation of an offer to buy, subscribe for or otherwise acquire any securities in any jurisdiction including, without limitation, the Restricted Jurisdictions or any other jurisdiction in which such offer or solicitation would be unlawful. This Announcement and the information contained in it is not for publication or distribution, directly or indirectly, to persons in a Restricted Jurisdiction unless permitted pursuant to an exemption under the relevant local law or regulation in any such jurisdiction.

This Announcement is not for publication or distribution, directly or indirectly, in or into the United States of America. This announcement is not an offer of securities for sale into the United States. The securities referred to herein have not been and will not be registered under the U.S. Securities Act of 1933, as amended (the "Securities Act"), and may not be offered or sold in the United States, except pursuant to an applicable exemption from registration. No public offering of securities is being made in the United States.

No action has been taken by the Company, Peel Hunt LLP ("Peel Hunt"), Liberum Capital Limited ("Liberum") or any of their respective directors, officers, partners, agents, employees, affiliates, advisors, consultants, persons connected with them as defined in FSMA (as defined below) (together, "Affiliates") that would permit an offer of the Placing Shares or possession or distribution of this Announcement or any other publicity material relating to such Placing Shares in any jurisdiction where action for that purpose is required. Persons receiving this Announcement are required to inform themselves about and to observe any restrictions contained in this Announcement.

This Announcement is directed at and is only being distributed to: (A) persons in member states of the European Economic Area who are "qualified investors", as defined in Article 2(e) of the Prospectus Regulation (Regulation (EU) 2017/1129) (the "Prospectus Regulation"), (B) if in the United Kingdom, qualified investors who have professional experience in matters relating to investments who fall within the definition of "investment professionals" in Article 19(5) of the Financial Services and Markets Act 2000 (Financial Promotion) Order 2005, as amended (the "Order") or fall within the definition of "high net worth companies, unincorporated associations etc." in Article 49(2)(a) to (d) of the Order or (C) persons to whom it may otherwise lawfully be communicated (each, a "Relevant Person"). No other person should act on or rely on this Announcement and persons distributing this Announcement must satisfy themselves that it is lawful to do so. By accepting the terms of this Announcement, you represent and agree that you are a Relevant Person. This Announcement must not be acted on or relied on by persons who are not Relevant Persons. Any investment or investment activity to which this Announcement or the Placing relate is available only to Relevant Persons and will be engaged in only with Relevant Persons. As regards all persons other than Relevant Persons, the details of the Placing set out in this Announcement are for information purposes only.

Persons (including, without limitation, nominees and trustees) who have a contractual or other legal obligation to forward a copy of this Announcement should seek appropriate advice before taking any action.

This Announcement is not being distributed by, nor has it been approved for the purposes of section 21 of FSMA by, a person authorised under FSMA. This Announcement is being distributed and communicated to persons in the United Kingdom only in circumstances in which section 21(1) of FSMA does not require approval of the communication by an authorised person.

No prospectus will be made available in connection with the matters contained in this Announcement and no such prospectus is required (in accordance with the Prospectus Regulation) to be published.

The information contained in this Announcement is for background purposes only and does not purport to be full or complete. No reliance may be placed for any purpose on the information contained in this Announcement or its accuracy, fairness or completeness. None of the information in this Announcement has been independently verified or approved by Peel Hunt, Liberum or any of their respective Affiliates.

Certain statements in this Announcement are forward-looking statements, which include all statements other than statements of historical fact and which are based on the Company's expectations, intentions and projections regarding its future performance, anticipated events or trends and other matters that are not historical facts. These forward-looking statements, which may use words such as "aim", "anticipate", "believe", "could", "intend", "estimate", "expect" and words of similar meaning, include all matters that are not historical facts. These forward-looking statements involve risks, assumptions and uncertainties that could cause the actual results of operations, financial condition, liquidity and dividend policy and the development of the industries in which the Company's businesses operate to differ materially from the impression created by the forward-looking statements. These statements are not guarantees of future performance and are subject to known and unknown risks, uncertainties and other factors that could cause actual results to differ materially from those expressed or implied by such forward-looking statements. Given those risks and uncertainties, prospective investors are cautioned not to place undue reliance on forward-looking statements. Forward-looking statements speak only as of the date of such statements and, except as required by the London Stock Exchange or applicable law, the Company, Peel Hunt, Liberum and their respective Affiliates undertake no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise.

Any indication in this Announcement of the price at which the Company's shares have been bought or sold in the past cannot be relied upon as a guide to future performance. Persons needing advice should consult an independent financial adviser. No statement in this Announcement is intended to be a profit forecast and no statement in this Announcement should be interpreted to mean that earnings per share of the Company for the current or future financial years would necessarily match or exceed the historical published earnings per share of the Company.

Peel Hunt and Liberum, each of which is authorised and regulated in the United Kingdom by the FCA, are acting exclusively for the Company and for no one else in connection with the Placing and will not be responsible to anyone other than the Company for providing the protections afforded to their respective clients for providing advice in relation to the Placing, or any other matters referred to in this Announcement.

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 or on behalf of the Company, Peel Hunt, Liberum or by their respective Affiliates as to, or in relation to, the accuracy or completeness 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 liability therefor is expressly disclaimed. 

Recipients of this Announcement should conduct their own investigation, evaluation and analysis of the business, data and property described in this Announcement. This Announcement does not constitute a recommendation concerning any investor's options with respect to the Placing. The price and value of securities can go down as well as up. Past performance is not a guide to future performance. The contents of this Announcement are not to be construed as legal, business, financial or tax advice. Each shareholder or prospective investor should consult with his or her or its own legal adviser, business adviser, financial adviser or tax adviser for legal, financial, business or tax advice.

The Placing Shares to be issued pursuant to the Placing will not be admitted to trading on any stock exchange other than AIM.

Neither the content of the Company's website (or any other website) nor the content of any website accessible from hyperlinks on the Company's website (or any other website) is incorporated in, or forms part of, the Placing Documents.

 

END

 

 

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