15th Jun 2016 11:34
LONDON (Alliance News) - Leed Resources PLC Wednesday said it will hold a meeting with shareholders next month in order to explain ongoing issues concerning the proposed deal that is set to lead to the company fully owning High Mannor Pty Ltd.
Leed Resources struck a deal in February to acquire Battalion International Ltd in order to become the controlling shareholder in High Mannor, which it is already invested in, but has faced difficulties whilst conducting due diligence that is delaying the deal.
"The due diligence process associated with the potential transaction has taken significantly longer than expected, chiefly due to the delays in bringing the High Mannor wall panels to market, raising a new working capital facility for the business and, as previously announced, a review of internal controls following the identification of a fraud perpetrated by a manager since dismissed," said Leed.
"These factors have required both a restructuring of High Mannor and changes to its management. As a result of these issues it is now very unlikely that the company will be able to make a definitive decision whether or not to proceed with or have sufficient time to complete the potential transaction before August 15, 2016, being the date by which Leed has the right to exercise its option to acquire Battalion," the company added.
Leed shares have been suspended since the deal was struck on February 15, but if an AIM company's shares are suspended for longer than six months then the shares are cancelled - which in this case would be on August 16.
"The directors are keen to explain to shareholders the consequences of the above information, why they do not believe rushing to complete the potential transaction by 15 August 2016 is in the best interests of shareholders and their strategy for creating value for shareholders going forward," said Leed.
The company will now hold a meeting in London on July 1 to address shareholders, but said it will release a further announcement before then with new information.
By Joshua Warner; [email protected]; @JoshAlliance
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