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Blancco Tech Grp PLC (BLTG)

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Thursday 12 December, 2019

Blancco Tech Grp PLC

Acquisition of minority interests in subsidiaries

RNS Number : 5867W
Blancco Technology Group PLC
12 December 2019
 

12 December 2019

 

BLANCCO TECHNOLOGY GROUP PLC

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

 

Acquisition of minority interests in subsidiaries

 

Blancco Technology Group (AIM: BLTG), the industry standard in data erasure and mobile device diagnostics, announces the acquisition of third-party shareholdings in Blancco Japan Inc., its joint venture in Japan ("Blancco Japan"), taking its ownership from 51% to 80%, and in Blancco APAC Pte. Limited, its subsidiary in APAC ("Blancco APAC") which takes the Company's ownership from 70% to 100% (together, the "Acquisitions").  The Acquisitions mark Blancco's continued progress to take full control of its global entities with the remaining 20% of the Japanese subsidiary held by Aucnet Inc ("Aucnet") being the only interest held in the Group by a third party.

 

Acquisition of joint venture partner interest in Blancco Japan

Blancco has acquired 29% of the issued share capital in Blancco Japan from its joint venture partner, Aucnet, taking Blancco's shareholding from 51% to 80%. The consideration payable to Aucnet is £1.08m, to be settled through the issue of 813,253 Blancco ordinary shares of 2p each ("Ordinary Shares") at an issue price of 132.8p per Ordinary Share1 ("Aucnet Consideration Shares"). Aucnet continues to hold the remaining 20% of the issued share capital of Blancco Japan that Blancco does not own.

 

Following the transaction Blancco will have full Board control of the subsidiary. As a result, Blancco will be able to take control of the cash generated by the subsidiary and to also fully include Blancco Japan in the transfer pricing structure of the Group. As a committed shareholder in Blancco plc, Aucnet will continue to be an important partner for Blancco in Asia but also in other parts of the world where it currently has a presence and the Group is confident that this partnership will lead to new opportunities that will further increase Blancco's future growth.

 

For the year ended 30 June 2019, Blancco Japan recorded net profit of JPY 160.5m (£1.2m). The net assets attributable to Blancco Japan as at 30 June 2019 were JPY 412.6m (£3.1m).

 

Acquisition of all minority interests in Blancco APAC

Blancco has acquired the 30% that it did not already own of the issued share capital in Blancco APAC Pte. Limited, its subsidiary in APAC, being 15% each from both of the minority shareholders, Aucnet and Alan Puah. The consideration payable to Aucnet is US$1 in cash, and the consideration payable to Alan Puah is US$83,583 (£64,613), to be settled by the issue of 41,686 Ordinary Shares at an issue price of 155.0p per Ordinary Share2 ("Alan Puah Consideration Shares").

 

Following the transaction, the only remaining joint venture arrangement will be from the 20% holding in Blancco Japan by Aucnet. All other subsidiaries are now 100% owned by Blancco.

 

For the year ended 30 June 2019, Blancco APAC recorded net losses of SGD 0.9m (£0.5m). The net liabilities attributable to Blancco APAC as at 30 June 2019 were SGD 1.0m (£0.6m).

 

Related party transaction

The acquisitions constitute related party transactions under AIM Rule 13 by virtue of Aucnet being a substantial shareholder in Blancco Japan and Blancco APAC and Alan Puah being a substantial shareholder in Blancco APAC.

 

Accordingly, the independent Directors, being all of the Company's Directors, having consulted with Peel Hunt LLP, the Company's Nominated Adviser, consider the terms of the transactions to be fair and reasonable insofar as the Company's shareholders are concerned.

 

Application for admission

Application has been made for the Aucnet Consideration Shares and Alan Puah Consideration Shares, totalling 854,939 Ordinary Shares ("Consideration Shares") to be admitted to trading on AIM ("Admission") and it is expected that Admission will take place on or around 17 December 2019.

 

Following Admission, the Consideration Shares will rank pari passu with the existing Ordinary Shares, the total number of Ordinary Shares in issue will be 75,363,842 and the total number of voting rights will also be 75,363,842. This figure may be used by shareholders as the denominator for the calculations by which they will determine if they are required to notify their interest in, or a change to their interest in, the share capital of the Group under the FCA's Disclosure and Transparency Rules.

 

1 Issue price has been calculated as a 10-day trailing average closing price, up to and including the price at the point of agreement on 2 December 2019

2 Issue price is the price at the point of agreement on 2 December 2019

 

Ends


 

Blancco Technology Group plc

Matt Jones, Chief Executive Officer

Adam Moloney, Chief Financial Officer

 

via Buchanan

Peel Hunt (Nominated Advisor & Broker)                                       

Edward Knight / Nick Prowting / Edward Allsopp

 

+44 (0) 20 7418 8900

Panmure Gordon (UK) Limited (Joint Broker)

Dominic Morley, Corporate Finance

Charles Leigh Pemberton, Corporate Broking                                                                         

 

+44 (0) 20 7886 2500

Buchanan Communications Limited

Chris Lane / Stephanie Watson / Charlotte Slater

[email protected]

 

+44 (0) 20 7466 5000

 

About Blancco

Blancco Technology Group plc is the industry standard in data erasure and mobile device diagnostics.  For more information, please visit www.blanccotechnologygroup.com.

 


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