Acquisition and Placing
11 3월 2009 - 4:00PM
UK Regulatory
TIDMSGD
RNS Number : 6494O
SectorGuard PLC
11 March 2009
SectorGuard plc
Acquisition of Legion Group Plc
Placing to raise approximately GBP1.98 million
SectorGuard plc ("SectorGuard" or the "Company"), a leading provider of total
security solutions, is delighted to announce the entering into of a binding
agreement to acquire the entire issued share capital of Legion Group plc
("Legion"), the oldest parking services and security group in the UK.
Acquisition Highlights:
* Legion is a leading provider of manned guarding and CCTV monitoring services to
the public and private sectors with a long established history in parking
services.
* In the year ended 30 September 2008, Legion had turnover of GBP27.5 million,
with a 17 per cent. gross profit, employing around 1,200 licensed security
personnel and 200 car park and traffic operatives.
* Legion is a wholly-owned subsidiary of the Royal British Legion Attendants
Company Trust ("RBLACT"), a registered charity that was set up in 1923 with the
aim of promoting employment opportunities to ex servicemen and women.
* Legion is to be acquired for an initial consideration of GBP1. In addition,
SectorGuard will also pay the RBLACT the sum of GBP100,000 per annum for ten
years.
* Acquiring Legion provides an excellent opportunity for SectorGuard to acquire an
iconic brand with an impressive portfolio of work that increases the market
penetration of SectorGuard and opens up new opportunities.
The Company also announces a placing of 197,925,400 new ordinary shares at 1p
per share to assist in the successful integration of Legion. The Company further
announces that Mark Higgins has agreed to lend GBP1m to the Company (the "Loan")
and has also agreed that certain rights to additional cash consideration under
the Manguard acquisition agreement can be paid by way of loan notes ("Loan
Notes"), in each case convertible, by agreement between the Company and Mark
Higgins, into ordinary shares at a conversion price of 1p per share.
Mark Higgins,
Chief Executive of SectorGuard commented:
"The acquisition of Legion Group plc will further enhance the Company's position
as a top tier provider employing in excess of 2,700 staff within the UK Manned
Guarding sector. Legion Group's heritage, brand and client portfolio should
generate significant shareholder and stakeholder value once the integration is
completed. We are very excited to announce this milestone event for
SectorGuard."
11 March 2009
Enquiries:
+-------------+---------------+
| SectorGuard | 01992 701972 |
+-------------+---------------+
| Mark | |
| Higgins, | |
| Chief | |
| Executive | |
+-------------+---------------+
| Charlie | |
| Cleverly, | |
| Managing | |
| Director | |
+-------------+---------------+
| | |
+-------------+---------------+
| Seymour | 020 7107 8000 |
| Pierce | |
+-------------+---------------+
| Jonathan | |
| Wright | |
+-------------+---------------+
| | |
+-------------+---------------+
| College | 020 7457 2020 |
| Hill | |
+-------------+---------------+
| Nick | |
| Elwes | |
+-------------+---------------+
www.sectorguard.co.uk
About Legion
Legion Group plc is the UK's oldest established parking services and security
services group and a leading provider of manned guarding and CCTV monitoring
services to the public and private sectors. Legion provides civil parking
enforcement services and car park management services to local authorities,
shopping centres, retail parks and private organisations nationwide. Legion has
nine offices nationwide.
For the year ended 30 September 2008, Legion had a turnover of GBP27.5 million
with a gross profit of GBP4.5 million and overheads of GBP5.5 million.
Legion is unique in providing both security services and parking services.
Through its subsidiary company, Legion Technologies Ltd, Legion is the single
point of contact for access to an extensive range of bundled services utilising
today's most advanced technology, including sophisticated electronic access
control systems, portable perimeter protection, covert tracking technology and
lone worker protection. By combining the services of Legion's experienced
officers and world-class technology, Legion is able to offer innovative, fully
integrated solutions designed to meet clients' specific requirements
Legion's national workforce of approximately 1,400 fully trained and, where
necessary, licensed officers is dedicated to providing the highest levels of
customer service. Legion has accredited training programmes for manned guarding,
CCTV monitoring and parking services personnel to ensure that all staff are
fully updated on current legislation, industry best practice and the latest
technological advances.
Legion Group plc is a wholly-owned subsidiary of the RBLACT, a registered
charity with the aim of promoting employment opportunities for ex servicemen and
women.
Legion is a Security Industry Authority approved contractor.
Rationale for the transaction
The security market has seen widespread changes in the last six months resulting
in security companies needing to provide a more balanced portfolio of services
as well as client focussed approach. The enlarged group will provide a greater
breadth of services and this, combined with the improved internal model which is
focussed on client support, will enable the enlarged group to compete more
effectively in the security market.
The parking enforcement element of the Legion portfolio provides in excess of
200 staff and siginificant access to a wider market place for the combined
business.
The enlarged group will retain the Legion name and brand whilst using the
SectorGuard model to improve the client service and efficiencies which have been
developed and implemented by the new SectorGuard team in the last three months.
Details of the Acquisition, the Placing and the Loan from Mark Higgins
SectorGuard has agreed to acquire the entire issued share capital of Legion for
an initial consideration of GBP1. In addition, the Company will also pay a sum
of GBP100,000 per year for ten years to the RBLACT.
The Company is also raising approximately GBP1.98 million before expenses
through a placing of 197,925,400 shares at 1p per share.
Mark Higgins, CEO of SectorGuard has also agreed to provide the Company with a
loan of GBP1 million. The Loan is for a maximum term of three years, but is
repayable in cash at the Company's option at any time after 18 months or
repayable, by agreement between the Company and Mark Higgins, at any time by the
issue of ordinary shares in the Company equal to the then outstanding balance at
an issue price of 1p per share. The Loan attracts interest at 3 per cent. above
3-month LIBOR.
The Loan from Mr Higgins and the net proceeds of the placing will be used to
assist in the successful integration of Legion with the Company.
The integration of the two companies is expected to take approximately six
months to complete.
Manguard additional consideration
Pursuant to the terms of the agreement by which SectorGuard acquired Manguard
plc from Mark Higgins in 2008, additional cash consideration is payable in 2009
and 2010 dependant on the Manguard business achieving certain levels of turnover
and gross profit.
The independent directors of SectorGuard have determined that at least GBP1.3
million of the maximum GBP1.5 million of the first year additional payment will
become due to Mr Higgins.
The Company has agreed with Mark Higgins that the additional consideration due
in 2009 shall be converted into loan notes on broadly the same terms as those
relating to the Loan mentioned above save that the Loan Notes become due and
payable in cash on the later of 1 September 2010 and 3 months from the date of
issue of the relevant Loan Notes. In consideration for Mark Higgins taking the
Loan Notes, the Company has agreed to issue GBP1m of the Loan Notes earlier than
the corresponding amount of additional cash consideration that would otherwise
be due on 4 May 2009.
Furthermore, the Loan Notes may be repaid at any time by agreement between the
Company and Mark Higgins, if repayment is made by the issue of shares in the
Company. The issue price of such shares will be 1p per share.
It is the intention of the Company to call a General Meeting of the Company
shortly to increase (if appropriate) the authorised share capital of the
Company, to authorise the directors to allot relevant securities pursuant to
section 80 Companies Act 1985 and to disapply pre-emption rights in so far as
may be necessary to allow the Company to satisfy all or part of the Loan and/or
the Loan Notes by the issue of new ordinary shares in the Company and in order
to restore the headroom in the number of shares available for issue.
Each of the Loan, the issue of the Loan Notes and the early payment of the
additional consideration referred to above are related party transactions
pursuant to the AIM Rules. The independent directors of SectorGuard, Stephen
Thomas and Charlie Cleverly, having consulted with Seymour Pierce, consider that
the terms of the Loan Notes and the early payment of the additional
consideration are fair and reasonable insofar as shareholders are concerned.
Application will be made for the admission of 197,925,400 new ordinary shares to
trading on AIM and admission is expected to occur on 16 March 2009. Following
admission, SectorGuard will have 593,776,248 ordinary shares in issue each
carrying one voting right.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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