3rd Mar 2015 08:33
LONDON (Alliance News) - Coalfield Resources PLC Tuesday said it has agreed terms to acquire the 75.1% stake in Harworth Estates Property Group Ltd which it does not already own for GBP150 million in cash and shares, and will be raising GBP115.0 million in a share placing to pay for the deal.
Coalfield, a UK-based property investment holding company, will pay Pension Protection Fund GBP97 million in cash and will also issue it with 730.7 million new Coalfield shares.
It will pay for the cash element of the deal by raising GBP115.0 million through a share placing and open offer involving 1.59 billion shares at 7.25 pence a share. The remaining net proceeds from the placing will be used to provide the company with additional investment capital.
The deal will mean PPF holds a 25% stake in Coalfield.
It said the offer price presents a 19.5% discount to the unaudited pro forma net asset value per share of the enlarged group of 9.00 pence. It said the consideration of GBP150 million represents roughly a 20% discount to the net asset value of Harworth Estates as at end-December 2014.
"Coalfield Resources is delighted to announce this transaction with the Pension Protection Fund. It re-establishes under single ownership the property business of Harworth Estates and we welcome the PPF as a 25% investor. It will complete the transformation of the company to a specialist brownfield property developer," said Chairman Jonson Cox in a statement.
Harworth Estates is one of the largest property and regeneration businesses across the East Midlands, Yorkshire and the North of England, according to Coalfield. Harworth Estates owns and or manages a diversified portfolio of approximately 27,000 acres across some 200 sites, valued at approximately GBP298.5 million with net assets of approximately GBP248.6 million.
Coalfield said that once the acquisition is complete, it plans to change its name to Harworth Group PLC to reflect the change in the company's underlying operations.
"We will be in a strong position to take full advantage of our proven skills in the property and regeneration markets and to deliver value," said Cox.
The placing and open offer are being fully underwritten by Investec.
Coalfield shares were untraded Tuesday morning. The shares last traded at 5.40 pence.
By Rowena Harris-Doughty; [email protected]; @rharrisdoughty
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