14th Oct 2005 07:00
Cape PLC14 October 2005 14 October 2005 Cape PLC ("Cape" or "the Company") Update on Scheme of Arrangement On 16 June 2005, Cape announced a proposed Scheme of Arrangement ("the Scheme")to provide for the long term financing of a great majority of all future UKasbestos-related claims likely to be successfully made against the Group. Theproposals included the establishment of an initial £40 million fund, into whichthe Company will have ongoing top-up obligations, to be used in the settlementof claims covered by the Scheme. The fund is planned to exist for as long asthere are Scheme claims, currently estimated to be not less than 46 years. Since the announcement, Cape and its advisors have engaged in consultation withall interested parties, claimants, asbestos victims support groups and theirrepresentatives, members of parliament, and trade union officials. The purposeof this consultation was to provide further detail and to make clear the meritsof the Scheme to both existing and future claimants. The board believes that theScheme significantly reduces all future claimants risk of not receiving compensation. As set out in the announcement dated 21 July 2005 in order toaccommodate the level of interest and to ensure that all parties had sufficienttime to consider these proposals the consultation period was extended byagreement to the end of October 2005. Arising from the consultation process the board, along with its legal advisorsand counsel, has given further consideration as to how certain claims that mayarise from former employees previously employed by liquidated companies, formersubsidiaries of the group, should be handled going forward. After carefulconsideration the board has decided that it is in the interests of all claimantsthat future claims of this type should be included in the Scheme. Although this does not increase the total number of claims likely to comeforward this will inevitably result in an increase in the number of claims to besatisfied by the scheme. The board has therefore asked its independent actuariesto review the effect of recognising these claimants within the Scheme. The Scheme will continue to be subject to independent review every three years witha subsequent annual top up by the Company as and when necessary. The board believes that these proposals are in the interests of all stakeholdersand in particular future claimants. As a consequence Cape will shortly attemptto contact all relevant former employees affected by this decision asking thatthey register their interest in the scheme. Martin K May, Chairman of Cape PLC, commented: "The company believes that it is far better for UK claimants to be in the Schemethan outside as it helps to minimise the risk to their future payments. Wereiterate that the proposed £40m fund is an initial figure, which we are committed to top up as and when necessary. The Company remains committed to thefund for as long as there are Scheme claims, currently estimated to be not lessthan 46 years." For further information please contact: Cape PLCMartin May, Chairman +44 (0) 1924 876 276 Bell Pottinger Corporate & FinancialNick Lambert +44 (0) 20 7861 3232 / +44 (0) 7811 358 764 This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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