24th May 2007 14:25
Norman Hay PLC24 May 2007 Norman Hay plc (the "Company") ANNOUNCEMENT The Coventry Site The Board announces that today, 24 May 2007, a conditional agreement has beenreached to sell the Company's Coventry freehold site ('Godiva Place') to asubsidiary of UNITE Group plc, the UK's number one student hospitality company. Any sale is subject to an acceptable Planning Permission being granted. For some time Norman Hay plc has anticipated that its city centre site inCoventry could not continue to absorb the changes required for the Group'sfuture. The site currently incorporates the Norman Hay Head Office, Norman HayEngineering, Ultraseal International, MX Systems International and some ofSurface Technology's coatings business. The current net book value of the asset is £1,840,000. Following receipt of anacceptable Planning Consent, the final consideration will be made up of: (i) A deposit of £225,000 (of which £25,000 isnon-refundable) payable on the exchange of the above agreement. (ii) A first instalment of £2,000,000 payable uponreceipt of an acceptable planning permission. (iii) A second instalment ranging from £5,531,000 to£7,040,000 payable upon vacant possession. The second instalment will be paid dependent upon the number of beds on thesite, agreed through planning permission. As a result, dependent upon the actualplanning permission granted, the site will achieve a value of between £7,756,000and £9,265,000. The sale proceeds will be used in part to fund the relocation costs, with theremaining proceeds being reinvested in the Company to fund future growth. The sale of the property is also conditional upon the release or modification ofa restrictive covenant which affects part of the site. It is expected that arelease will need to be negotiated with the beneficiaries and any releasepremium will be paid out of disposal proceeds. The final consideration is expected to be disclosable in accordance with AIMrule 12 and therefore a further announcement will be made following confirmationof the consideration. Victor Bellanti, Chief Executive of Norman Hay plc, said: "I am looking forward to working with the Coventry City Council and the UNITEGroup plc, to bring this new modern student accommodation to the City whilstallowing Norman Hay to create its new home in Coventry. Our existing location isnot suitable for the changing shape of our business, especially being so closeto the city centre. If this scheme is given the go-ahead, we plan to move to anew, fit-for-purpose site in the Coventry area". James Hunt, Regional Acquisition and Development Manager of UNITE Group plc,agreed and added: "This is another great opportunity for UNITE to further grow our presence in theCoventry market. This site is conveniently located for student living, beingclose to the City centre, and opposite both Coventry University and our latestproperty, Callice Court. "The development of this site will be a positive improvement for the localenvironment. Our investment will be in excess of £45,000,000 and this togetherwith the expenditure our student residents bring, will benefit the broader localcommunity and local businesses. "The sale and development is subject to planning approval and we will workclosely with our stakeholders to ensure their key requirements are met anddelivered". - END - NORMAN HAY - is the UK's number one surface coatings company and a world leaderin the supply of sealant chemistry for the automotive and constructionindustries. The Company's advanced chemical products and processes enable metal componentsof all sizes to be protected when operating in harsh environments, and arewidely used in the oil and gas, aerospace and general engineering industries. UNITE - is the UK's number one student hospitality company. UNITE delivers the real student experience, whilst at the same time helping to regenerate cities as part of the community and contributing to the improvement of the country's housing. The Group focuses on the provision and management of high quality, well-locatedstudent accommodation and hospitality services in strong higher educationmarkets. UNITE undertakes the planning, development and management of sites,often working closely with the universities and colleges, to deliveraccommodation for students across all ages and nationalities. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
Unite