25 March 2024
Leeds Group
plc
("Leeds" or the
"Company")
Further re Disposal, Loan
Agreements and Related Party Transactions
The Board of Leeds Group plc
('Board') announces that, further to the announcement on 29
February 2024, the Proposed Sale of Hemmers is expected to complete
on 26 March 2024. The Company also announces that it has entered
into loan agreements for, in aggregate, EUR 2.0 million (together
the "Loan Agreements" or "Transactions") with Bronsstadet AB, a
company controlled by Peter Gyllenhammar, a substantial shareholder
of the Company, and CA Fastigheter AB, a company controlled by
Johan Claesson, a Non-executive Director of the Company (together
the "Lenders").
Loan Agreements
Pursuant to the Loan Agreements, the
Company has received EUR 1.0 million (together the "Funding Loans")
from each of the Lenders which will be utilised as bridge loan
financing to pay in full a loan guarantee to KSK Bank of EUR 1.1
million in relation to the KMR insolvency and withholding tax of
EUR 0.8 million. The Funding Loans are unsecured and each bear an
interest rate of 8 per cent. per annum with a one-off EUR 10,000
handling fee. The Funding Loans are expected to be repaid from bank
loans of EUR 2 million anticipated to be received by the Company's
subsidiary LG Nordhorn Property GmbH once the Proposed Sale of
Hemmers is completed, recovery of EUR 0.6 million of withholding
tax from the German tax authorities and a distribution of
approximately EUR 0.9 million by the KMR insolvency administrator.
The Recovery of the withholding tax and distribution from the KMR
Insolvency administrator are expected within 3-6 months of the
transaction completion.
Related Party
Transactions
The Loan Agreements constitute
related party transactions for the purposes of Rule 13 of the AIM
Rules by virtue of Johan Claesson being a substantial shareholder
and director of the Company and controller of CA Fastigheter AB,
and Peter Gyllenhammar being a substantial shareholder of the
Company and controller of Bronsstadet AB, therefore CA Fastigheter
AB and Bronsstadet AB are considered related parties. Jan Holmstrom
and David Cooper, being directors of the Company independent of the
Transactions, having consulted with the Company's nominated
adviser, Cairn Financial Advisers LLP, consider that the terms of
the Transactions are fair and reasonable in so far as the Company's
shareholders are concerned.
Capitalised terms used in this
Announcement shall, unless otherwise defined, have the same meaning
as set out in the announcement on 15 December 2023.
This announcement contains inside
information for the purposes of UK Market Abuse Regulation and has
been arranged for release by Jan G Holmstrom, Chairman.
Enquiries:
|
Leeds Group plc
Dawn Henderson
|
Tel: 01937 547877
|
|
Cairn Financial Advisers
LLP
Nominated Adviser
Sandy Jamieson / Liam Murray / James
Western
|
Tel: 020 7213 0880
|
Cautionary statement
Certain statements made in this
announcement are forward-looking statements. Such statements are
based on current expectations and assumptions and are subject to a
number of risks and uncertainties that could cause actual events or
results to differ materially from any expected future events or
results expressed or implied in these forward-looking statements.
Persons receiving this announcement should not place undue reliance
on forward-looking statements. Unless otherwise required by
applicable law, regulation or accounting standard, the Company does
not undertake to update or revise any forward-looking statements,
whether as a result of new information, future developments or
otherwise.