28th Feb 2006 07:02
Cape PLC28 February 2006 28 February 2006 Cape PLC Scheme of Arrangement - Update 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 Company andthose of its subsidiaries included in the Scheme. Since July 2005 Cape has beencontinuing discussions with interested parties including claimants, asbestosvictims support groups and their representatives. The reason for thesediscussions has been: • To give sufficient time and information to interested parties to examine the proposal in detail and for them to make recommendations. • To give comfort to interested parties that the proposal is in the interests of claimants and future claimants and that the commercial and legal arrangements underpinning the Scheme are justifiable and robust. As a result: • As announced on 17 January 2006, Cape has funded an independent legal review of the Scheme by solicitors and counsel (including a leading national asbestos claimant firm of solicitors, Thompsons). • As also announced on 17 January 2006, Cape has funded an independent financial review of the Scheme by accountants KPMG. The legal and financial reviews have raised a number of issues on the proposedScheme as a result of which Cape has agreed to make a number of amendments tothe Scheme but has declined to make other changes highlighted by the reviews.None of the issues raised is considered by the Directors to be fundamental tothe working of the Scheme or to the benefits which it is intended to deliver. On 17 January 2006, Cape also announced that discussions were continuing withits bank regarding an extension of its loan facilities pursuant to which some ofthe initial Scheme funding of £40 million is to be provided. These discussionshave now been concluded and a further extension to the facilities agreed. It isa condition to Cape's draw down under the revised facilities that the Schemebecomes effective by no later than 30 June 2006. The next stage of the Scheme process will take place in the week commencing 27February 2006 when Cape makes an application to the High Court to seek an orderto convene meetings of the Scheme creditors - in other words to authorisemeetings at which claimants will be able to vote on the Scheme. Assuming that the Court makes an order in the terms Cape requests, it iscurrently anticipated that these creditors' meetings will take place in earlyMay 2006. The Scheme will also require Cape's shareholders to pass a resolutionapproving a number of the amendments to the Scheme. At the same time as theScheme documentation is sent to creditors, a circular will be sent toshareholders. The circular will describe, inter alia, the principal changes thathave been made to the original Scheme proposals and will also contain a noticeof extraordinary general meeting (the "EGM") at which Cape's shareholders willbe asked to approve the changes. It is currently anticipated that the EGM will take place in early April 2006. For further information, please contact: Cape PLCMartin May, Chairman +44 (0) 1924 876 276 Bell Pottinger Corporate & FinancialNick Lambert +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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