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Ingenta PLC (ING)

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Wednesday 26 February, 2003

Ingenta PLC

Placing and Open Offer

Ingenta PLC
26 February 2003

                          Ingenta plc ('the Company')


            Placing and Open Offer of 41,314,981 new Ordinary Shares




Introduction


The audited results of the Company for the year ended 30 September 2002 have
been posted to Shareholders today. The Board has also today announced details of
proposals (the 'Proposals') to raise a total of £2.07 million, before expenses,
to provide additional working capital by way of a Placing and Open Offer of
41,314,981 new ordinary shares of 5p each in the Company ('Ordinary Shares').


Implementation of the Proposals will require the issue of additional share
capital of the company and the Proposals are therefore conditional, inter alia,
on the passing by Shareholders of relevant resolutions at an EGM to be held at
9.30am on 21 March 2003.


Details of the Placing and Open Offer are set out below.


Application will be made for all of the new Ordinary Shares to be admitted to
trading on AIM. It is expected that Admission will become effective and that
dealings in the new Ordinary Shares will commence, following the EGM, on 24
March 2003.


Background to and Reasons for the Proposals


The statement issued by the Company accompanying the preliminary results
released on 10 December 2002 confirmed that Ingenta continues to make
substantial progress in its underlying trading activities and that the Board had
responded rapidly to a slowing rate of new business acquisition through
reorganisation and the introduction of new management. The Board remains
committed to this policy of growing the business in a cost effective way.


In reviewing the working capital requirements of the Company, the Directors have
had regard to the fact that it is still relatively early in the financial year.
Whilst they are confident that the Company's performance will show continuing
growth, there is still a wide range of possible outcomes for the year, and hence
a wide range of possible working capital requirements for the Company. In the
current uncertain business climate the Directors feel it is appropriate to take
a prudent view of the possible outcomes for the year, and to provide for a
working capital requirement at the lower end of the range of possible outcomes
for the year. In arriving at this conclusion the Directors have taken into
account:


(a)     business already contracted; and


        (b)     prudent assumptions consistent with business achieved in the
        last financial year in relation to both repeat business from existing
        customers and new business to be won and recognised during the current
        year.


The Board has therefore announced details of proposals to raise £1.80 million
(net of expenses) in a way which provides certainty and additional flexibility
for the Company and also allows Shareholders fully to participate. Without the
above injection of capital the Company may not be able to continue in
operational existence for the foreseeable future.


Current Trading and Prospects


The repeat nature of certain of the Group's revenue streams (for example from
maintenance and upgrade contracts and revenue sharing) means the base of
actually contracted income, and expected repeat business from existing
customers, going into the new financial year continues to increase and benefit
from new business won during the 2002 financial year.


The above factors, taken together with the Group's market position and overall
market potential, its relatively high margins, stable operating costs,
strengthened management team and re-organised operations, provide the Board with
confidence for the prospects of the Group.


Details of the Placing and Open Offer


The Company is proposing to raise approximately £1.80 million net of expenses,
by way or a Placing and Open Offer of 41,314,981 new Ordinary Shares. The
Directors and certain other Shareholders have irrevocably agreed to subscribe
for their full entitlement under the Open Offer representing 7,450,115 Offer
Shares in aggregate. In addition, the Directors and certain other parties have,
in effect, underwritten the balance of the Offer Shares by irrevocably agreeing
to subscribe for them subject to clawback to satisfy valid applications under
the Open Offer from Qualifying Shareholders. The Placing and Open Offer is not
being underwritten by Collins Stewart.


Qualifying Shareholders may subscribe for Offer Shares at the Issue Price in
proportion to their shareholdings on the record Date on the basis of:


              2 Offer Shares for every 3 existing Ordinary Shares


held at the close of business on the Record Date, 20 February 2003, at a price
of 5p per share. To the extent that the Offer Shares are not taken up under the
Open Offer they will fall to be allotted to Placees under the Placing.
Application by Qualifying Shareholders will be satisfied in full up to their pro
rata entitlement.


The net proceeds of the Placing and Open Offer will be used to provide
additional working capital for the Company.


The Placing and Open Offer is conditional inter alia upon the passing of the
Resolutions to be proposed at the EGM, upon the Placing and Open Offer Agreement
becoming unconditional in all respects and not being terminated in accordance
with its terms and upon Admission. Under the terms of the Placing and Open Offer
Agreement Collins Stewart has the right to terminate in the event of inter alia
any of the warranties contained therein not being true, breach by the Company of
its obligations under the Placing and Open Offer Agreement or occurrence of any
event requiring the publication of a supplementary prospectus. Collins Stewart
does not have the right to terminate in the event of force majeure.


The Open Offer is not being made to Overseas Shareholders.


The New Ordinary Shares issued pursuant to the Placing and Open Offer will, when
issued, rank pari passu in all respects with the existing issued Ordinary
Shares, including the right to receive all dividends and other distributions
declared, made or paid on or after, or by reference to a record date on or
after, the date of their issue and will be free of all liens, charges and
encumbrances. It is expected that Admission will become effective and dealings
in the new Ordinary Shares will commence on 24 March 2003.


Directors' and other Shareholders' Intentions


All of the Directors and certain other Shareholders have irrevocably undertaken
to subscribe for their full entitlement of new Ordinary Shares under the Open
Offer in respect of their own shareholdings, equivalent to a total of 7,450,115
Ordinary Shares, representing 7.21 per cent. of the Company's enlarged issued
share capital. In addition, the Directors and certain other parties have
irrevocably agreed to subscribe for the balance of the Offer Shares subject to
clawback to satisfy valid applications under the Open Offer from Qualifying
Shareholders.


Annual General Meeting and Extraordinary General Meeting


An EGM of the Company has been convened for 9.30am on 21 March 2003. At the
meeting, Shareholders will be asked to consider resolutions to:


        (1)     increase the authorised share capital of the Company to
        £7,750,000 by the creation of an additional 55,000,000 Ordinary Shares
        of 5p each;


        (2)     authorise the Directors to allot, inter alia, the Offer Shares
        for the purposes of section 80 of the Act;


        (3)     disapply the statutory pre-emption rights set out in section 89
        of the Act to enable the Directors, inter alia, to allot the Offer
        Shares; and


        (4)     to amend the Company's borrowing powers under its Articles of
        Association in order to allow it to utilise its banking facilities.


The Placing and Open Offer Agreement is conditional upon the passing of these
Resolutions. The Directors have no present intention to allot any Ordinary
Shares pursuant to the authority proposed to be granted to them at the
Extraordinary General Meeting, save for the allotment of the Offer Shares and
the allotment of Ordinary Shares in the event of share options being exercised.


The Board is appointing Grant Thornton to act as auditors. A resolution
confirming their appointment will be put to shareholders at the Annual General
Meeting of the Company to be held at 9.00am on Friday 28 March 2003.


Recommendation


If the resolutions are not passed at the EGM, or net proceeds of at least £1.80
million are not raised under the Placing and Open Offer for any other reason,
the Company may not have sufficient working capital for its present
requirements, and in the absence of additional financial support, may be unable
to continue in operational existence for the foreseeable future.


The Directors therefore consider that the Proposals are in the best interests of
the Company and the Shareholders taken as a whole. Accordingly, the Directors
unanimously recommend you to vote in favour of the Resolutions to be proposed at
the Extraordinary General Meeting, as they have irrevocably undertaken to take
up their own entitlements under the Open Offer and vote in favour of the
Resolutions in respect of their own beneficial holdings of 9,325,173 Ordinary
Shares held at the date of this document which, together with undertakings to
vote in favour of the Resolutions already received from the holders of a further
1,850,000 Ordinary Shares, represents approximately 18 per cent. of the
Company's issued ordinary share capital.


Further information:


Mark Rowse

Ingenta plc          01865 799 000






26 February 2003


                      This information is provided by RNS
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