Proposed administration and cancellation of listing, 24 August 2012
24 August 2012
Mouchel Group plc ("Mouchel" or the "Company"), the infrastructure and business services group, announces that following the General Meeting ("GM") held this morning at which shareholders rejected the terms of the proposed restructuring plan (the "Restructuring"), the Directors have applied to the High Court for the appointment of administrators to the Company.
This is the first step in implementing an alternative plan to achieve a restructuring of the group's capital structure (the "Alternative Plan"). As announced earlier today, the Alternative Plan involves an alternative mechanism to implement the commercial principles of the Restructuring for the Mouchel group and which will safeguard the businesses within the Mouchel group and the interests of the group's employees, customers and suppliers.
The Company's discussions with its lenders have been successfully concluded. Accordingly, the terms of the alternative plan have now been finalised and the Board expects that the administrators will be appointed imminently and that, following their appointment, the administrators will immediately sell the Company's assets (including the group companies beneath the Company) to a newly incorporated company. It is expected that following completion of the Alternative Plan, this company will be owned by affiliates of the Company's lenders RBS, Lloyds Banking Group and Barclays and management. As the Restructuring was not approved, shareholders will not receive the proposed special dividend and, given the level of existing debt owed by the group, the expected sale by the administrators will result in shareholders not receiving any value for their shareholding.
As announced earlier today, the listing of the Company's ordinary shares on the Main Market of the London Stock Exchange was suspended following the GM. It is expected that, once appointed, the administrators, on behalf of the Company, will request the UK Listing Authority to cancel the Company's ordinary shares from admission to the Official List of the UK Listing Authority.
It is not intended that any company in the group, other than the Company itself, will enter in any form of insolvency process which means that no employees, customers or suppliers are expected to be materially affected and all of the group's trading subsidiaries should continue to trade as usual. The Company expects to announce further details in respect of the implementation of the Alternative Plan shortly.
David Shearer, Chairman of Mouchel,
"While it is unfortunate that shareholders have chosen not to approve the terms of the restructuring, and in doing so have declined the opportunity to receive the special dividend of 1p per share, the Board is pleased that the restructuring of the Mouchel group's balance sheet can be implemented by an alternative mechanism, by which existing customer contracts and employees will be safeguarded, achieving the objective of securing the businesses' long-term future.
The Board believes that the group's businesses are stable and that the expected sale and related transactions will provide them with a sustainable capital structure for the future."
For further information please contact:
Mouchel Group plc
Grant Rumbles, Chief Executive
Rod Harris, Group Finance Director
Aideen Lee / Azhar Khan
020 7404 5959