23rd Nov 2006 07:02
Works Media Group (The) PLC23 November 2006 THE WORKS MEDIA GROUP PLC PROPOSED PLACING The Board of The Works Media Group plc (the 'Company') announces that itproposes to raise £1,250,000 before expenses by way of a placing of 62.5 millionnew ordinary shares in the Company at a price of 2p per share. The Company is a feature film rights distribution and sales group. In 2005, itrefocused its business on what the board believed to be a more profitable partof the film industry, and launched a UK Distribution subsidiary. It hasincurred losses in starting up this business and it wishes to invest in theacquisition of further film rights to enable it to increase sales volumes inboth the UK Distribution subsidiary and in the existing International Salessubsidiary. The Board believes that the activities of both businesses arescaleable and that to date they have been constrained by a lack of capital. The Board believes that the net proceeds of the placing will provide necessaryworking capital to allow the Company to develop the UK Distribution subsidiaryand the International Sales subsidiary. Without these additional funds, theBoard believes that the Company's business plan would not be able to bedeveloped in the way in which it is proposed. As the issue price of 2 pence per share is below the 10 pence nominal value ofthe Company's existing ordinary shares, it will therefore be necessary to carryout a capital reorganisation in order for the placing to proceed. This willinclude a subdivision of each of the Company's 10 pence ordinary shares into one0.1 pence ordinary share and one deferred share of 9.9 pence. The placing pricerepresents a discount of approximately 63.6% to the mid market price of theExisting Ordinary Shares as at 21 November 2006. The Board considers thisdiscount to be necessary in order to provide the level of additional fundingrequired to assist in meeting the Company's growth targets. 37.5 million of the new ordinary shares are to be placed by Seymour Pierce Elliswith its clients failing which it will subscribe for the shares itself. Thebalance of the new ordinary shares have been subscribed for by certain of theDirectors and other placees. The following Directors of the Company have agreed to subscribe for new ordinaryshares at the placing price: Director New Ordinary Shares Number of New Ordinary Percentage of Enlarged subscribed Shares held following Issued Share Capital proposed placing following proposed placingCrispin Barker 17,850,000 29,865,885 28.34Domenico Procacci* 2,500,000 14,355,937 13.62James Atherton 500,000 1,166,666 1.11Norman Humphrey 250,000 292,000 0.28*Domenico Procacci's holding is held by a company controlled by him, Fandango SRL The Directors participating in the placing are deemed to be entering into aRelated Party Transaction as defined by rule 13 of the AIM Rules. TheIndependent Director of the Company, Christopher Auty, having consulted with theCompany's nominated adviser, City Financial Associates Limited, considers theterms of the placing are fair and reasonable insofar as the shareholders of theCompany are concerned. A circular containing details of the proposed placing and capital reorganisationtogether with a Notice of EGM and a proxy card have been posted to shareholders.At the EGM, resolutions will be proposed to effect the capital reorganisationand approve the placing. The EGM will be held at 10.00am on Friday 15 December2006. Application will be made to the London Stock Exchange for the admission of thenew ordinary shares to trading on AIM. It is expected that dealings in the newordinary shares will commence at 8.00 am on Monday 18 December 2006. Copies of the circular and form of proxy will be available to the public free ofcharge from the registered office of the Company, 4th Floor Portland House, 4Great Portland Street, London W1W 8QJ, during normal business hours for a periodof one month from today. Enquiries:The Works Media Group plc 020 7612 0030Norman Humphrey, Finance DirectorCity Financial Associates Limited, Nominated Adviser 020 7090 7800James Caithie This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
Winking Studios