5th Nov 2019 18:28
(Alliance News) - Asset management services provider Urban Exposure PLC on Tuesday said it will evaluate the proposal from R20 Advisory Ltd and will issue a further statement "if and when appropriate".
Earlier on Tuesday, R20 has written to the board of Urban Exposure with a restructuring proposal.
The move follows R20 having built a stake of almost 13% in Urban Exposure over the last six months and is focused on restructuring the company's business to restore shareholder value and improve liquidity in the shares.
R20 explained that, in its view, Urban Exposure's underperformance is driven in a large part by the current structure of the company including high management costs.
To facilitate the restructuring of Urban Exposure into a publicly traded debt fund, R20 on Tuesday proposed a carve out of the management company from Urban Exposure, thereby saving annual costs estimated to be between GBP12 million and GBP13 million and the issue of a 30 pence a share dividend.
After the carve-out, R20 explained that the management company will be majority owned and controlled by Urban Exposure.
R20 also said Urban Exposure should issue another 100 million shares at 35p each, giving existing shareholders an opportunity to participate first.
As part of the proposal, R20 said it will underwrite the maximum it is permitted to acquire, being 57% of the proposed share issuance.
R20 highlighted that it will not, as a result of this proposal, own more than 29.9% of the share capital of Urban Exposure.
Urban Exposure shares closed 1.3% higher in London on Tuesday at 57.75p each.
By Evelina Grecenko; [email protected]
Copyright 2019 Alliance News Limited. All Rights Reserved.
Related Shares:
UEX.L