16th Jul 2015 13:56
LONDON (Alliance News) - City of London Group PLC Thursday announced plans to raise between GBP3.0 million and GBP4.5 million through a share subscription and move to AIM from the Main Market of the London Stock Exchange, as it posted a narrowed pretax loss for its recently ended financial year.
The investment company has conditionally agreed an equity fund raising of between GBP3 million and GBP4.5 million with existing shareholders and new investor Cain Hoy Enterprises LLC. The subscription is at 30 pence per share. It said it has reserved the right to increase the size of this subscription to up to GBP6 million in case of additional demand from third parties.
Shares in City of London are untraded Thursday afternoon. They last closed at 22.50 pence.
City of London said it believes that given the size of the company the AIM market is a "more appropriate market on which to develop". The move would be subject to shareholder approval.
Additionally the company said it is now entirely focused on small-to-medium-sized enterprises and professional services funding, and as a result is proposing an amended, more-focused investing policy.
For the year to end-March, the company posted a pretax loss of GBP1.6 million, narrowed from a pretax loss of GBP5.2 million a year before, which it attributed to an improvement in the profitability of its investee companies and a 55% reduction in central overheads. It expects to produce continued improvements in the year ahead.
City of London agreed to sell its investment in its litigation funding associate Therium for GBP3.4 million in April. A profit of GBP1.5 million from this sale will be shown in the company's current year results, it said.
"Our results for last year announced today demonstrate a substantial improvement in the performance of both the holding company and its investee companies. The group is now streamlined and focused on SME and professional services funding following the recent sale of its litigation funding associate," said Acting Chief Executive Officer John Kent in a statement.
"With the additional funding announced today we shall have the capital necessary to continue this improvement. The proposed move to AIM will further help the implementation of COLG's plans for the next stage of growth," Kent added.
By Hana Stewart-Smith; [email protected]; @HanaSSAllNews
Copyright 2015 Alliance News Limited. All Rights Reserved.
Related Shares:
CIN.L