23rd May 2005 09:45
R.E.A.Hldgs PLC23 May 2005 R.E.A. Holdings plc (the "company")Possible reconstruction of the 4 per cent convertible loan stock 2012 of thecompany (the "stock"). The company currently has outstanding £3,057,307 nominal of the stock with apresent market value of some £15.3 million (based on the closing mid marketprice per £100 nominal of the stock on 20 May 2005 as obtained from the LondonStock Exchange website). In view of the right of holders of the stock to convert their holdings of stockinto new ordinary shares in the capital of the company during the month of June2005, the company announces that the board is at an early stage in consideringproposals for a possible reconstruction of the stock. The reconstruction, if implemented, would involve the conversion of the entireoutstanding stock, following the passing of necessary enabling resolutions ofthe stockholders and ordinary shareholders, into a combination of new ordinaryshares and new dollar denominated loan notes of the company on terms that havestill to be determined. The proposals would be conditional, inter alia, on thenew ordinary shares and the new loan notes being admitted to the Official Listmaintained by the UK Listing Authority and to trading on the London StockExchange's market for listed securities. It is currently proposed that the newordinary shares and new loan notes to be issued pursuant to the reconstructionshould have an aggregate value (the "conversion value") that would represent asmall premium to the value of the ordinary shares that would arise on fullconversion of the stock in accordance with its current conversion terms (valuesfor this purpose being determined by reference to market prices at the time ofthe formal announcement of the terms of the reconstruction). It is envisagedthat some 80 per cent of the conversion value would be represented by the newordinary shares and the balance by the new loan notes. Whilst there can be no certainty that the board will decide to proceed with suchproposals, nor that, if put to stockholders and shareholders, the appropriateresolutions would be passed or that the conditions of the proposals would besatisfied, the board believes that holders of stock should be aware of thepossibility of the proposals when deciding whether or not to exercise theconversion rights attaching to their stock during June 2005. In order tofacilitate such decision by holders of the stock, it is the company's intention,and the trustee of the stock has agreed in principle, that, in the event thateither the contemplated proposals do not proceed or, if they do proceed, do notbecome unconditional, the terms of the stock will be amended so as to provide anextra conversion period during which holders may exercise the conversion rightsattaching to their stock, such extra conversion period to be a one month periodcommencing as soon as reasonably practicable after determination of the positionregarding the contemplated proposals. If the board does decide that it would be in the best interests of the companyand its shareholders as a whole to proceed with the proposals, it is expectedthat a circular setting out the proposals would be sent to stockholders andshareholders in July or August of this year. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
R.e.a.hldgs.