Conditional Placing and Directorate Changes

RNS Number : 1282Q

Eclectic Bar Group PLC

15 June 2015

 



For Immediate Release

15 June 2015

Eclectic Bar Group plc

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

Conditional Placing, Directors' Dealings and Directorate Changes

Eclectic, one of the leading operators of premium bars in the UK, is pleased to announce that Luke Johnson, the serial leisure entrepreneur, intends to subscribe for 3,000,000 new ordinary shares of 25 pence each in the capital of the Company ("Ordinary Shares") at a price of 50 pence per Ordinary Share (the "Subscription Price"), and the Self Invested Pension Plans of Reuben Harley, Eclectic's Chief Executive Officer, and John Smith, Eclectic's Chief Financial Officer, each intend to subscribe for 150,000 new Ordinary Shares (300,000 new Ordinary Shares in total) at the Subscription Price (the "Subscriptions"). The Subscriptions will raise £1.65 million for the Company, and will provide additional working capital to fund the development of the Group's business.

The Subscription Price represents a premium of 3.1 per cent. to the middle market closing price of 48.5 pence per Ordinary Share on 12 June 2015.

The Ordinary Shares to be issued under the Subscriptions to Luke Johnson will represent approximately 18.5 per cent. of the Company's issued share capital as enlarged by the Subscriptions.

On completion of the Subscriptions, Reuben Harley will be beneficially interested in 2,006,920 Ordinary Shares, representing approximately 12.4 per cent. of the issued share capital of the Company as enlarged by the Subscriptions, and John Smith will be beneficially interested in 1,253,719 Ordinary Shares, representing approximately 7.7 per cent. of the issued share capital of the Company as enlarged by the Subscriptions.

In connection with the Subscriptions, the Company has entered into three subscription agreements. The Subscriptions are conditional upon, inter alia, the granting of authority to issue shares and disapplication of pre-emption rights by shareholders of the Company ("Shareholders") at a general meeting to be held as soon as possible, but no later than 31 July 2015 (the "General Meeting"), and the admission of the Ordinary Shares issued under the Subscriptions to trading on AIM ("Admission"). A further announcement will be made confirming when a circular to Shareholders, including a notice convening the General Meeting, is despatched and an anticipated date for Admission. The Ordinary Shares which are the subject of the Subscriptions, when issued, will be credited fully paid and will rank pari passu in all respects with the Company's existing Ordinary Shares.

In conjunction with the Subscription by Luke Johnson, the Company announces that Mr Johnson has been appointed to the Board as Executive Chairman with immediate effect. Jim Fallon will remain with the business as a Non-executive Director.

Mr Johnson has many years' experience of guiding, developing and growing leisure businesses both in the public and private arenas. He has been involved in the hospitality industry for over twenty years, including as chairman of PizzaExpress Plc during the 1990s; co-founder and chairman of the Strada restaurant chain; and chairman of Giraffe restaurants for nine years until 2013. He is currently chairman of Patisserie Holdings plc, Gail's bakeries (Bread Holdings Ltd) and Buffet Restaurants Limited.

Mr Johnson has agreed not to draw a salary in respect of his appointment. The Company has conditionally agreed to issue warrants to subscribe for up to 1,622,274 Ordinary Shares at a price of 60 pence per Ordinary Share (the "Warrants") to Mr Johnson, conditional granting of authority to issue shares and disapplication of pre-emption rights by Shareholders at the General Meeting. The Warrants, which will represent approximately 10 per cent. of the Company's issued share capital as enlarged by the Subscriptions, can be exercised in up to two tranches, and must be exercised by 30 June 2019, failing which they will lapse. Were the Warrants to be exercised in full and assuming no other issues of new Ordinary Shares, Mr Johnson would be beneficially interested in approximately 25.9 per cent. of the Company's enlarged issued share capital.

Luke Johnson has undertaken pursuant to a deed not to dispose of any interest in any of the Subscription Shares or any Ordinary Shares granted on exercise of the Warrants for 12 months from Admission of the Ordinary Shares issued to him under the Subscriptions, except in certain limited circumstances.

Additionally, Richard Kleiner steps down from the Board with immediate effect.

The Company also announces that it is considering cancelling certain of its existing employee share options, and granting new share options to certain employees at an exercise price commensurate with the existing price per Ordinary Share to incentivise key employees. Further details on this proposal will be announced in due course.

Jim Fallon, Non-executive Chairman, commented:

The Board is delighted that Luke Johnson has agreed to join Eclectic. He brings a wealth of experience, contacts and opportunities to the business and we look forward to working with him to develop Eclectic further. Together with the existing team, and the injection of capital through the Subscription, he will help drive the business in the next stage of its development. On behalf of the Board I would like to express our thanks to Richard Kleiner for the contribution he has made to the Company over many years, including his valued service on the Board since February 2014 and also assisting Eclectic as a private company prior to its flotation."

Reuben Harley, Chief Executive Officer of Eclectic, commented:

"I am excited at the opportunity to work with Luke Johnson. We will continue to work hard on improving the core business, but with the additional skill set on the Board, and the net proceeds of the Subscription, we will be able to accelerate the Group's plans and development as well as diversifying into a broader range of hospitality offers."

Luke Johnson, newly appointed Executive Chairman of Eclectic, commented:

"There is a great business within Eclectic with much potential, including some great people and an attractive portfolio of sites. It has firm foundations and continues to be cash generative. I look forward to gaining a deeper understanding of the business over the coming months, and helping them to plan and execute a strategy for growth."

The following information is disclosed pursuant to Schedule Two, paragraph (g) of the AIM Rules for Companies:

Mr Luke Oliver Johnson, age 53

Current Directorships and partnerships:

Previous directorships and partnerships (held in the past five years):

3Sixty Restaurants Ltd AKA Group Ltd Arden Partners plc Assembly Festival Ltd Beak Street Films Ltd Bread Acquisitions Ltd Bread Holdings Ltd Buffet Restaurants Ltd The Career Colleges Company (UK) Ltd Cedar Pharma Ltd The Centre for Entrepreneurs Ltd Chrysalis Vision Ltd Cradley Brook Ltd Cruise.co (Holdings) Ltd The Curious Cook Ltd Draft House Holding Ltd Ego Group Ltd Ego Restaurants Ltd Ego Restaurants Holdings Ltd Feng Sushi Ltd Fiery Dragons Ltd The Generation of Z Ltd The Genuine Dining Company Ltd The Grand Union Company Ltd Halesend Estate Ltd Hermitage Valley Ltd ICR Enterprises Ltd The Institute of Cancer Research: Royal Cancer Hospital Ltd London 8 Ltd Majestic Bingo Ltd Majestic Bingo Online Limited Neilson Active Holidays (Holdings) Ltd Patisserie Acquisition Ltd Patisserie Holdings PLC Patisserie Valerie Holdings Ltd Penyard House Acquisition Ltd Poseidon House Management Ltd RCP II Founder Partner LP RCP Co-Investment Partnership LP Recruitment Capital Partners LLP Risk Capital Ltd Risk Capital Partners II (GP) Ltd Risk Capital Partners II (Scotland) Ltd Risk Capital Partners LLP Spice Bakery Ltd Superbrands Ltd Synarbor PLC Theatre Investment Fund Ltd Zoggs Acquisitions Limited Zoggs Group Limited

Action on Addiction APT Controls Ltd Automotive Repair Solutions Ltd The Bishopsgate Foundation Channel Four Television Corporation Clear Leisure PLC The Cobden Club Ltd Contiga Capital Management LLP E2Exchange Ltd The Entrepreneurial Exchange (London) Ltd Flour Power City Ltd Forestrox Ltd Giraffe Concepts Ltd Harbour and Jones Ltd History Today Ltd Interquest Group plc Interquest (UK) Ltd Metro Bank PLC Metrodome Group Limited Phaidon Press Ltd Playful Productions LLP RSA Academies RSA Adelphi Enterprises Ltd Seafood Holdings Ltd Seafood Property Holdings LLP Signature Restaurants Ltd StartUp Britain Ltd Third Stage Productions Ltd

Automotive Repairs Ltd was wound up by the court in September 2012 and Luke Johnson was a director until his resignation in October 2011.

Bookshop Acquisitions Ltd and Borders (UK) Ltd entered administration in November 2009. Luke Johnson had previously been a director of these companies until July 2009. Bookshop Acquisitions Ltd and Borders (UK) Ltd were dissolved on 22 February 2013 and 27 August 2011 respectively.

The Cobden Club Ltd, of which Luke Johnson is currently a director, entered members' voluntary liquidation in July 2013 and is currently in liquidation.

English Classic Cars Limited, where Luke Johnson was a director from 8 December 1989 until its dissolution on 25 November 1995, was placed in insolvent liquidation on 6 April 1992.

Income Tax Professionals Ltd, a company of which Luke Johnson was non-executive chairman, entered creditors' voluntary liquidation in May 1999.

Just Tyres Holdings Ltd, a company of which Luke Johnson was non-executive chairman, entered administrative receivership in October 2001. The company was dissolved on 17 July 2007.

Robinbuy Limited, of which Luke Johnson was a non-executive director until 20 February 1997, was placed into liquidation on 24 February 1997 following its solvent reconstruction and was dissolved on 19 February 2000.

Sunday Business Newspapers Ltd entered administrative receivership in July 1997. Luke Johnson had previously been a non-executive director of the company until his resignation in March 1997. The company was dissolved on 18 May 2004.

Utility Cable PLC entered administrative receivership in September 1998. Luke Johnson had previously been a non-executive director of the company until his resignation in May 1998. The company was dissolved on 23 November 2007.

Enquiries:

Eclectic Bar Group plc       (www.eclecticbars.co.uk)	Tel: [phone]
Reuben Harley, CEO John Smith, CFO
Panmure Gordon	Tel: [phone]
Corporate Finance
Andrew Godber / Atholl Tweedie / Duncan Monteith
Corporate Broking
Charles Leigh-Pemberton / Maisie Atkinson
Instinctif Partners	Tel: [phone]
Matthew Smallwood
Justine Warren

About Eclectic

Eclectic is a leading operator of premium bars in the UK. Eclectic's portfolio comprises 19 venues located in major towns and cities, predominantly targeting a customer base of sophisticated students midweek and stylish over 21s and young professionals at weekends. The Company focuses on delivering added value for its customers, with premium product ranges, high-quality music and entertainment, and a commitment to high service levels and standards. Eclectic trades across its estate under a variety of brands, including Embargo Republica, Lola Lo, Lowlander, Sakura, Po Na Na and Fez Club.

The Group's management team, led by Luke Johnson, who has been involved in the hospitality industry for over 20 years, and Reuben Harley, who has over 25 years' experience of working in the UK pub and bar industry, is implementing a strategy to grow the business through the development of new sites either under the Company's existing brands or using brands which can be successfully maintained, as well as business acquisitions as appropriate opportunities present themselves.

 

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