17th Mar 2008 07:35
Savile Holdings Plc (the "Company" or "Savile") Acquisition of IDDAS Limited
The Board of Savile Holdings plc is pleased to announce that on 14 March 2008 it entered into a conditional agreement to acquire the entire issued share capital of IDDAS Limited ("IDDAS"). Jonathan Cohen, a director of the Company, is a shareholder in IDDAS and accordingly the Acquisition constitutes a related party transaction under the AIM Rules and also a substantial property transaction involving a director, under s190 of the Companies Act 2006, and therefore requires the consent of Shareholders. Accordingly, a circular has today been posted to Shareholders which, inter alia, convenes a General Meeting of the Company on 7 April 2008 at which the Resolution to approve the Acquisition will be proposed to Shareholders. The circular also contains the half year results for the Company for the six months ended 31 December 2007, which have been separately announced today.
Summary of the proposed Acquisition
Savile has agreed, subject to shareholder approval, to purchase 100% of the issued share capital of IDDAS by the issue of 2,498,912 Consideration Shares. At the close of business on 14 March 2008 the mid-market price of an Ordinary Share was 12.75 pence valuing IDDAS at approximately ‚£319,000. The net assets of IDDAS at 31 January 2008 were ‚£313,336.
Jonathan Cohen, a director of Savile who is beneficially interested in 1,087,776 Ordinary Shares of Savile, is also a director of IDDAS and owns 28,767 ordinary shares in IDDAS, representing 32% of its issued share capital.
Background on IDDAS
Jonathan Cohen and David Stewart founded IDDAS in 2002. IDDAS offers a range of transition mentoring and other career advisory services to senior executives of FTSE and unlisted companies, and partners of professional firms. The business, which is based in the West End of London, has as its Chairman, Lord Freeman, and employs a team of 4 full time and 3 part-time staff.
In addition, IDDAS has over 25 associates who are involved in client assignments on a project by project basis. These mentors include Elizabeth Filkin, former Parliamentary Commissioner for Standards, Sir Nicholas Montagu, former Chairman of the Inland Revenue, Martin Smith, Deputy Chairman of New Star Asset Management and Christopher Leslie, a partner in Zygos Limited. The IDDAS Legal Panel members are Janet Gaymer CBE, former Senior Partner of Simmons & Simmons, Terence Kyle, former Managing Partner of Linklaters and Francis Neate, former Chairman of the International Bar Association.
IDDAS has a broad, blue chip and expanding client base and the turnover in its financial year ended 30 September 2007 amounted to ‚£614,805 generating a pre tax loss of ‚£11,015 (after directors' remuneration of ‚£310,217 including national insurance). At 30 September 2007 IDDAS had net tangible assets amounting to ‚£282,890 (including cash deposits of ‚£269,621). In the 4 months to 31 January 2008, turnover and profits were ‚£204,233 and ‚£30,446 respectively. Net assets as at 31 January 2008 were ‚£313,336. These figures are unaudited.
Reasons for the acquisition
The Board (other than Jonathan Cohen, who is interested in the transaction) believes that the Acquisition will provide significant benefits and opportunities to the enlarged Savile Group including:
* a broader and stronger product offering targeted at the senior executive and professional market; * a blue chip client base; * access to a strong and experienced team of associates; and * a presence in the West End of London.
The Board further believes the Acquisition will strengthen the Savile platform, generate additional revenue opportunities, synergies and economies of scale leading to improved profitability for the Group. In addition, IDDAS has net tangible assets, comprising mainly cash on deposit that will strengthen the Savile Group balance sheet and provide additional working capital for the enlarged and expanding Group.
Related party transaction
The proposed Acquisition constitutes a substantial property transaction with a director for the purposes of section 190 of the Companies Act 2006. This requires the prior approval of Shareholders and accordingly a circular convening a General Meeting ("GM") of the Company for the purpose of approving the Acquisition is being posted to Shareholders today. Jonathan Cohen, as both Chairman of Savile and a director and shareholder of IDDAS, has an interest in the Acquisition and as such will not vote on the Resolution to the proposed at the GM.
Furthermore, Rule 13 of the AIM Rules requires the Independent Directors to consider, having consulted with the company's nominated adviser, whether the terms of the Acquisition are fair and reasonable insofar as the Shareholders are concerned. The Independent Directors consider, having consulted with City Financial Associates Limited, that the terms of the Acquisition are fair and reasonable insofar as the Shareholders are concerned. In providing its advice, CFA has taken into account the commercial assessment of the Board.
The Independent Directors (ie the board other than Jonathan Cohen), who between them beneficially own 2,847,645 Ordinary Shares representing 25.5 percent of the Existing Ordinary Shares, have undertaken to vote in favour of the Resolution.
The GM is to be held at 10.30am on 7 April 2008 at 36-38 Cornhill, London EC3V 3PQ.
For further information please see www.savile.com or contact:
Mark Sidlin, DirectorSavile Holdings plcTel: 020 7816 0707Nominated AdviserCity Financial Associates LimitedTony Rawlinson, ChairmanTel: 020 7492 4777
SAVILE HOLDINGS PLCRelated Shares:
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