16th Mar 2006 09:27
Berkeley Berry Birch PLC16 March 2006 Disposal of the business of Berry Birch & Noble Financial Planning (Weston)Limited ('Weston') Further to the announcement made on 6 March 2006, Berkeley Berry Birch plc ('BBB') announces that its wholly owned subsidiary, Berry Birch & Noble Financial Planning ('Weston') Limited, has sold its business to Bates InvestmentServices Limited ('Bates'). The United Kingdom Listing Authority has granted a waiver under Listing Rule 10.8 in respect of the requirement to issue a circularand obtain shareholder approval for this disposal. Weston is a national Independent Financial Adviser ('IFA') business whichprovides personal financial planning advice services to individual clients viaits self-employed IFAs. Weston currently has approximately 80 self-employedIFAs. The initial consideration is £1. Deferred consideration is payable based on thelevel of renewals commission received, less the share paid to the self-employedIFA, in respect of the business in the year following completion. Based onprevious levels of such commissions, it is estimated that this deferredconsideration will be in the region of £100,000. In addition, Bates has assumedestimated liabilities with a book value of approximately £450,000, largely inrespect of indemnity commissions and commission payable to Weston's IFAs. Inaddition, there are a contingent liabilities in respect of indemnity commissionswhich, if they crystallise, will be payable by Bates up to a maximum of around£400,000. The book value of the gross assets sold is approximately £1,250,000,including goodwill of £945,000 recorded in BBB's consolidated balance sheet. All of the staff working for Weston have transferred to Bates, who has assumedthe liability for all payroll liabilities since 1 March 2006. For the year ended 31 March 2005, Weston reported turnover of £8,053,000 and aloss before tax of £1,606,000. Working capital The working capital position of the BBB Group was set out in the announcementmade on 28 February 2006. Application of proceeds The proceeds will be applied by Weston to meet its liabilities to its remainingcreditors. Future of the BBB Group The position on the future of the BBB Group was set out in the announcement madeon 6 March 2006. Financial position of BBB The directors of BBB confirm that in respect of the disposal of the Westonbusiness: (a) negotiation does not allow time for shareholder approval; (b) all alternative methods of financing have been exhausted and the only option remaining is to dispose of its remaining businesses; and (c) by taking the decision to dispose of this business to raise cash, the directors believe that they are acting in the best interests of the Company and shareholders as a whole. Arden Partners Limited, which is acting as the Company's sponsor, confirms that,in its opinion and on the basis of information available to it, BBB is in severefinancial difficulty and it will not be in a position to meet its obligations asthey fall due without this disposal taking place today. Enquiries: Andrew ShortisGroup Managing DirectorBerkeley Berry Birch plc024 7623 2010 This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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