13th Dec 2007 08:41
Coms PLC13 December 2007 COMS plc Potential Offer, Irrevocable Undertaking and AIM Rules Announcement Discussions with Sim4Travel Holdings plcComs plc (the "Company" or "Coms") announces that it is in discussions withSim4Travel Holdings plc ("Sim4Travel"), a company whose shares are traded on thePlus quoted market, which may or may not lead to an offer being made for thewhole of the issued share capital of Sim4Travel. Sim4TravelSim4Travel is a telecoms network independent company that offers travellers analternative to their domestic network solutions by providing travellers with newinternational (Pay As You Go) SIM cards for use whilst abroad. Sim4Travel'sservice, which covers over 120 countries, significantly reduces, and in somecases completely avoids international roaming charges. In addition, Sim4Travelprovides support that includes a top-up facility and UK based customer care,both of which can be accessed at any time from anywhere around the world. Sim4Travel was incorporated in September 2004 and admitted to trading on thePlus quoted market (then Ofex) on 5 May 2006. Information relating to a proposed offerThe basis of a proposed offer for Sim4Travel, should the discussions progress,will be a share for share exchange (with no cash alternative) and, in the lightof Sim4Travel's early stage of development, the aggregate value of the proposedoffer is likely to be in the region of £3m compared with Sim4Travel's currentmarket capitalisation of approximately £7.4m. Loan from Coms to Sim4TravelSim4Travel's financial position is such that interim funding is presentlyrequired to meet Sim4Travel's working capital requirements in the short term. The Company entered into a loan agreement ("Loan") with Sim4Travel on 5 December2007. Under the terms of the Loan, Sim4Travel can borrow up to the sum of£500,000 from the Company. Interest is payable on the loan at the rate of 5 percent per annum over Barclays Bank plc's base rate. The Loan and accrued interestare repayable on 30 March 2008 or on any later date agreed between the Companyand Sim4Travel. The Loan has been secured by way of fixed and floating chargesover Sim4Travel's assets granted to the Company under a debenture dated 5December 2007. Discussions with Nettworx and Irrevocable UndertakingAs part of its discussions with Sim4Travel, the Company has also been in talkswith one of Sim4Travel's principal shareholders, Nettworx, whose shares aretraded on AIM. These talks have led to Nettworx giving to the Company aconditional, irrevocable and binding undertaking under which Nettworx has agreedto the following obligations: 1. Nettworx will accept the terms of a proposed offer if andonly if such proposed offer for Sim4Travel is made by the Company following aTakeover Code Rule 2.5 announcement ('Announcement of a firm intention to makean offer'). 2. Nettworx will, in the event that an offer document isposted, accept the proposed offer in relation to both Nettworx's 117,333,333ordinary shares in the capital of Sim4Travel (representing 15.8% of Sim4Travel'sissued share capital - 11.8% on a fully diluted basis*) and the 126,000,000ordinary shares (representing 12.7% of issued share capital on a fully dilutedbasis*) which will arise from conversion of £756,000 of convertible loan noteswhich Nettworx holds (referred to in paragraph 4 below), even if a higheralternative offer has been made to Sim4Travel's shareholders.* allowing for conversion/exercise of loan notes, warrants and options3. At the same time, and conditional only upon the posting ofan offer document to Sim4Travel's shareholders, Nettworx will subscribe £500,000for 83,333,333 new ordinary shares in the capital of the Company at 0.6p pershare by way of a private placing. In addition, subject to compliance with theTakeover Code and any other regulatory issues, Nettworx will be issued a warrantto subscribe for a further 50,000,000 ordinary shares in the capital of theCompany at an exercise price of 0.6p and exercisable at any time during the 12month period following the warrant issue. This will be in consideration ofNettworx waiving its right under its existing warrants over 30,000,000 shares inSim4Travel.4. Nettworx will convert into equity all its outstandingSim4Travel convertible loan notes dated 13 April 2007 immediately upon theCompany declaring the proposed offer has become unconditional as to acceptances. Further Irrevocable UndertakingsThe Company intends, in the event that a Takeover Code Rule 2.5 announcement inrelation to Sim4Travel is made, to seek and obtain further irrevocableundertakings from Sim4Travel shareholders during the offer period. Reasons for the Announcement and AIM Rules 12 and 13The Loan from the Company to Sim4Travel is being disclosed at this time as itwill be a substantial transaction as regards the Company for the purposes of AIMRule 12. The Irrevocable Undertaking commitments referred to above are being disclosed atthis time in accordance with the AIM Rules as, notwithstanding their beingconditional upon a potential Takeover Code Rule 2.5 announcement in relation tothe proposed offer for Sim4Travel, the satisfaction of the condition is outsidethe control of Nettworx.The irrevocable commitment to dispose of Nettworx's shareholding of existingSim4Travel shares and further shares to be issued on the conversion of itsconvertible loan notes will be a substantial transaction for the purposes of AIMRule 12 and the irrevocable commitment to subscribe £500,000 for new ordinaryshares in the capital of the Company at 0.6p per share by way of a privateplacing will be a related party transaction for the purposes of AIM Rule 13,given that Jason Drummond is a director and the Chairman of the Company and isalso a director of Nettworx. The Directors of Coms, other than Jason Drummond,consider, having consulted with the Company's nominated adviser, that the termsof the transaction are fair and reasonable insofar as the Company's shareholdersare concerned. The Loan from Coms to Sim4Travel Information Required pursuant to Schedule 4 of the AIM Rules:--------------------------------------------------------------Particulars of the The transaction comprises a secured loan from Comstransaction, including the to Sim4Travel.name of any company orbusiness, where relevant:Description of the Business The assets involved in the transaction comprisecarried on by, or using, the the £500,000 loan, secured on Sim4Travel's assetsassets which are the subject which will be available for draw down byof the transaction: Sim4TravelThe profits attributable to Not applicable.those assets:The value ofthose assets: £500,000.The full consideration and £500,000 to be drawn down by Sim4Travel inhow it is being satisfied: accordance with the terms of the loan.The effect on the AIM The loan has been made available from thecompany: Company's existing cash resources which will be depleted as the loan is drawn down.Details of any service None.contracts of its proposeddirectors:In the case of a disposal, Not applicable.the application of the saleproceeds:In the case of a disposal, Not applicable.details on shareconsideration:Any other information The transaction is regarded as a substantialnecessary to enable investors transaction in accordance with AIM Rule 12. Theto evaluate the effect of the loan has been made available on commercial termstransaction upon the AIM to Sim4Travel in connection with the discussionscompany: between the Company and Sim4Travel which may or may not lead to an offer being made for the whole of the issued share capital of Sim4Travel. The Irrevocable Undertaking commitments from Nettworx Information Required pursuant to Schedule 4 of the AIM Rules:--------------------------------------------------------------Particulars of the The transaction comprises a conditional Irrevocabletransaction, including the Undertaking by Nettworx for the benefit of Coms andname of any company or the signing of a conditional placing commitment.business, where relevant: Description of the The assets involved in the transaction comprise theBusiness carried on by, or £500,000 subscription proceeds which will be paid tousing, the assets which Coms under a proposed private placing in return forare the subject of the the allotment and issue of new Coms shares.transaction:The profits attributable Not applicable.to those assets:The value ofthose assets: £500,000.The full consideration and £500,000 under a proposed private placing.how it is being satisfied: The effect on the AIM The effect on Coms of the transaction is that if Comscompany: decides to make a Takeover Code Rule 2.5 announcement in relation to the proposed offer and post an offer document, it will receive additional working capital of £500,000 to support the transaction costs incurred with the proposed offer and the combined working capital requirements of the enlarged group if and when the proposed offer is made and subsequently becomes unconditional as to acceptances.Details of any service None.contracts of its proposeddirectors:In the case of a disposal, Not applicable.the application of thesale proceeds:In the case of a disposal, Not applicable.details on shareconsideration:Any other information The transaction is regarded as a related partynecessary to enable transaction in accordance with AIM Rule 13 becauseinvestors to evaluate the Jason Drummond is a Director of both Nettworx andeffect of the transaction Coms. The Directors of Coms, other than Jasonupon the AIM company: Drummond, consider, having consulted with the Company's nominated adviser, that the terms of the transaction are fair and reasonable insofar as the shareholders are concerned. Sim4Travel AnnouncementSim4Travel is today making an announcement in accordance with the Takeover Codethat it is in talks with Coms which may or may not lead to an offer being madefor the whole of the issued share capital of Sim4Travel. Further AnnouncementA further announcement in relation to the proposed offer will be made, as andwhen required by the Takeover Code, in due course. Dealing Disclosure RequirementsUnder the provisions of Rule 8.3 of the Takeover Code, if any person is, orbecomes, "interested" (directly or indirectly) in 1% or more of any class of"relevant securities" of the Company or of the offeree, all "dealings" in any"relevant securities" of the Company or the offeree (including by means of anoption in respect of, or a derivative referenced to, any such "relevantsecurities") must be publicly disclosed by no later than 3.30 pm (London time)on the London business day following the date of the relevant transaction. Thisrequirement will continue until the date on which the offer becomes, or isdeclared, unconditional as to acceptances, lapses or is otherwise withdrawn oron which the "offer period" otherwise ends. If two or more persons act togetherpursuant to an agreement or understanding, whether formal or informal, toacquire an "interest" in "relevant securities", they will be deemed to be asingle person for the purpose of Rule 8.3. Under the provisions of Rule 8.1 of the Takeover Code, all "dealings" in"relevant securities" by the Company or the offeree, or by any of theirrespective "associates", must be disclosed by no later than 12.00 noon (Londontime) on the London business day following the date of the relevant transaction. A disclosure table, giving details of the companies in whose "relevantsecurities" "dealings" should be disclosed, and the number of such securities inissue, can be found on the Takeover Panel's website atwww.thetakeoverpanel.org.uk. "Interests in securities" arise, in summary, when a person has long economicexposure, whether conditional or absolute, to changes in the price ofsecurities. In particular, a person will be treated as having an "interest" byvirtue of the ownership or control of securities, or by virtue of any option inrespect of, or derivative referenced to, securities. Terms in quotation marks are defined in the Takeover Code, which can also befound on the Panel's website. If you are in any doubt as to whether or not youare required to disclose a "dealing" under Rule 8, you should consult theTakeover Panel. Date: 13 December 2007 Contact: Coms plcRichard Bennett, Corporate Development OfficerTel: +44 (0)20 7148 3600 HB CorporateRod VenablesTel: +44 (0)20 7510 8600 Notes to Editors: About ComsComs was founded by Jason Drummond in 2000 with the vision of using the Internetto carry and deliver voice telephone calls. Unlike Skype, Coms is based upon theindustry standard SIP protocol which enables the widest possible connection ofcustomers, devices and integrated Web 2.0 applications. Coms subscribers canmake high quality calls over the internet wherever a high-speed internetconnection is available including in wireless hotspots. Coms subscribers canalso select their own free telephone number. Ofcom has allocated Coms 2 millionnumbers in the top 178 UK geographic area codes by population which Comssubscribers can choose from. In addition, Coms can transfer a company's existingtelephone number to their service. Subscription is available in a range ofpackages from the Company's website www.coms.com.As well as the obvious cost saving implications for businesses and consumers,the expanding market will enable Coms to develop and offer innovative newconvergent services such as video calling, IP Centrex, location independence andonline presence. It is these new innovative features, alongside the cost savingbenefits that are likely to encourage customers away from traditional PSTNsystems and combine their broadband service and voice calling system.Coms launched its consumer service in October 2006, and recently acquiredExchangeXT, a leading provider of business VoIP services, to enable Coms toenter the SME market.Coms is an Ofcom authorised Public Electronic Communications Network (PECN) anda member of the Internet Telephony Service Providers Association (ITSPA).Coms plc joined the AIM market of the London Stock Exchange on 6 September 2006(AIM:COMS). This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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