Joint Venture
12 7월 2010 - 3:00PM
UK Regulatory
TIDMVYKE
RNS Number : 1642P
Vyke Communications PLC
12 July 2010
12 July 2010
Vyke Communications plc
("Vyke")
Joint Venture Agreement and Warrant Instrument
· Joint Venture Agreement to accelerate growth and development
· Access to market and sell services to new customers
· Expand Vyke in the US
· Joint Venture Agreement provides partner a target of generating US$100
million of new revenues for Vyke in first year and EBITDA in excess of US$1.5
million
· Warrant Instrument will result in partner being issued with Vyke shares
based on revenue and EBITDA performance levels
· Additional board members to be appointed from partner in due course
The Board of Vyke Communications plc (AIM: VYKE) is pleased to announce that
Vyke has entered into a joint venture agreement with Bonjour Europe Limited, a
wholly owned UK subsidiary of BLS TEL Holdings LLC, and its affiliates
("Bonjour") relating to the future operations of Vyke (the "Joint Venture
Agreement") together with a Warrant Instrument (as defined below) (together the
"Agreements"). The Agreements are conditional upon, amongst other things, Vyke's
shareholder approval and a circular to Vyke's shareholders will be sent out over
the next few days.
Bonjour is part of a group of companies which provide telecommunication products
and services across the globe, focusing on the emerging US and international
markets for mobile and international calling, managing over one billion minutes
annually. The Bonjour group currently has carrier, mobile and distribution
operations in the US and Africa and is expanding its reach to Europe through the
Joint Venture Agreement. Bonjour intends to use its relationships and market
position to expand the reach of the Vyke technology and products and services.
More information on BLS TEL Holdings LLC can be found at
http://www.blstel.com/index.html.
The Board of Vyke considers the transaction with Bonjour to be a unique
opportunity for Vyke to accelerate its growth and development in existing and
new markets. The management team of Bonjour and its affiliates have considerable
experience in running telecoms companies both in the US and worldwide and the
Board of Vyke believes that, in time, a number of synergies and cost saving
measures will be identified and implemented as a result of the relationship.
As described below, the Board of Vyke is optimistic about the transaction with
Bonjour and have been able to structure it in such a way that Bonjour is
rewarded only upon performance and delivery set out below.
The Joint Venture Agreement provides, inter alia, that Bonjour will utilise its
relationships and its experience to assist Vyke with management of its
operations and the generation of new synergistic and complimentary revenue
streams for Vyke. The Joint Venture Agreement provides Bonjour with a target of
generating US$100 million of revenue for Vyke for the 12 months to 30 June 2011
and contributing to the EBITDA of Vyke solely through Bonjour operations during
this period in excess of US$1.5 million. In working towards achieving these
targets, Bonjour is entitled to utilise such of the assets of Vyke as it
considers to be appropriate and Bonjour has also granted Vyke the right to
market to and sell services to a list of approximately 800,000 customers who
have previously purchased telecommunications products and services from
Bonjour's affiliates.
As consideration for Bonjour's services under the Joint Venture Agreement Vyke
has entered into a warrant instrument pursuant to which Bonjour has been granted
warrants (the "Warrants") to subscribe for such a number of new ordinary shares
of 1 penny each in the capital of Vyke as will result in Bonjour being issued
with the percentage of issued share capital of Vyke as is shown in column (3) of
the table below (calculated on a fully diluted basis taking into account all
agreements entered into at or before completion of the Joint Venture Agreement
under which Vyke may be required to issue shares to any third party but not any
agreements or commitments entered into by Vyke after that date) (the "Warrant
Shares") conditional upon the relevant sales revenue and EBITDA targets (subject
to various deductions and prepared in accordance with IFRS) for the 12 months
following the date of the Joint Venture Agreement shown in columns (1) and (2)
respectively of the table below:
+---------------+---------------+----------+
| Vyke turnover | EBITDA | % of |
| (US$m) (1) | generated for | issued |
| | Vyke solely | share |
| | through | capital |
| | Bonjour | of Vyke |
| | operations | (3) |
| | (US$m) (2) | |
+---------------+---------------+----------+
| 60 | 0.25 | 34 |
+---------------+---------------+----------+
| 80 | 0.75 | 45 |
+---------------+---------------+----------+
| 90 | 1 | 48 |
+---------------+---------------+----------+
| 100 | 1.5 | 51 |
+---------------+---------------+----------+
On exercise of the Warrants, the Warrant Shares issued to Bonjour will be
credited as fully paid by Vyke. In the event that the maximum number of Warrants
are not granted to Bonjour pursuant to the table above, Bonjour shall
nevertheless be entitled to be granted the balance of the Warrants conditional
upon meeting the outstanding sales revenue and EBITDA targets (subject to
various deductions and prepared in accordance with IFRS) shown in columns (1)
and (2) respectively of the table above in either of the 12 months following 1
July 2011 or 1 July 2012.
In addition to those conditions outlined above, the Agreements are also
conditional upon the consent of Vyke's shareholders to the issue of the Warrant
Shares free from any pre-emption rights as well as any and all consents that are
required pursuant to the AIM Rules for Companies, the Companies Act 2006 and the
Takeover Code (to the extent required) Bonjour is entitled to appoint up to four
additional directors to the board of Vyke, provided always that each appointment
is subject to the prior approval of Vyke. Further announcements will be made in
relation to these appointments at the appropriate time.
Following the issue of the Warrant Shares, Bonjour has agreed to enter into a
lock-in agreement restricting it from selling the Warrant Shares for the first
year following their issue (other than those sold to fund any tax liability
arising from the exercise of the Warrants by Bonjour in which case all such
shares shall be sold through Vyke's broker, Allenby Capital).
Further announcements will be made at the relevant time.
Allenby Capital Limited's fees for introducing Bonjour to Vyke will be satisfied
by the issue of shares in Vyke (credited as fully paid).
Jørgen Peter Rasmussen, Non-Executive Chairman, said: "This transaction with
Bonjour represents a key development in the history of Vyke. Bonjour, through
its affiliates in the BLS TEL Holdings LLC group, is an established telecoms
provider and the management team has considerable experience in running telecoms
companies both in the US and worldwide. The Board of Vyke believes that this
transaction will enable Vyke to accelerate its growth and development plans."
Given that the place of central management and control of Vyke is not in the UK,
Channel Islands or Isle of Man, the Company wishes to make shareholders aware
that it is no longer subject to the provisions of the Takeover Code.
----ends----
- For further information please contact: Vyke Communications plc
+-----------------------------+-------------------------------+
| Vyke Communications | +44 20 7732 3666 |
| Tommy Jensen, CEO | |
+-----------------------------+-------------------------------+
| | |
+-----------------------------+-------------------------------+
| Allenby Capital Limited | +44 20 3328 5656 |
+-----------------------------+-------------------------------+
| Nominated Adviser and joint | |
| broker | |
| Brian Stockbridge / Alex | |
| Price | |
+-----------------------------+-------------------------------+
| | |
+-----------------------------+-------------------------------+
| | |
+-----------------------------+-------------------------------+
| Threadneedle Communications | +44 20 7653 9850 |
| | |
+-----------------------------+-------------------------------+
| Graham Herring / Josh Royston |
+-----------------------------+-------------------------------+
About VYKE
Vyke Communications plc is a leading mobile Voice over Internet Protocol
("VoIP") provider and has offices in the UK, Norway, USA, Iceland and Malaysia.
The strategic goal of Vyke is to combine its expertise in VoIP-based
communication systems, mobile data service creation/handset technology and
wholesale carrier network management to provide a converged communication
solution. Vyke's current set of mobile-oriented products offers up to a 98%
discount compared to current typical mobile operator pricing structures.
About VYKE MOBILE IP
Vyke Mobile IP is the leading mobile-oriented Voice over IP (VoIP) service
offering users up to 98% discount compared to typical mobile operator pricing
structures. One of the first mass market mobile VoIP services, launched in April
of 2006, Vyke Mobile IP features mobile oriented sign-up steps, automatic
configuration services and pricing.
About the VYKE product suite
The Vyke suite of communication products features advanced services providing
users with low cost, mobile operator/fixed line provider independent ways of
making voice calls and sending text messaging from the mobile phone, PC and
internet.
Please visit www.vyke.com
This information is provided by RNS
The company news service from the London Stock Exchange
END
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