2nd Nov 2007 08:30
Minmet PLC02 November 2007 Stock Exchange Announcement Embargoed until: 08:30 hours, 2nd November 2007 Minmet plc Dissolution of arrangements with Gold Oil plc Minmet plc ("Minmet" or "the Company") (AIM: MNT) announces that on 2nd October2007, it agreed to terminate all arrangements with Gold Oil plc ("Gold Oil")concerning oil and gas interests in Cuba and Latin America ("the Transaction"),following a re-evaluation of these interests by the Company's board. In particular, as some of the oil and gas opportunities which the Company iscurrently reviewing are in the U.S, the Minmet board considered thatopportunities in the U.S. and Cuba could not be pursued by the same company dueto the longstanding U.S. embargo on doing business in Cuba. In consideration for the termination, Gold Oil will deposit its 8,300,000ordinary Minmet shares with a broker, with instructions to have these sharesplaced in the market and the proceeds distributed to Minmet. Minmet will depositits 22,950,000 ordinary shares in Gold Oil with a broker, with instructions tohave these placed in the market and the proceeds distributed to Gold Oil. Bothsets of shares are subject to lock in arrangements until February 2008, but suchrestrictions may be lifted with the appropriate consent. As Gold Oil had an interest of 24.76% in Minmet at the time of the Transaction,the Transaction is a related party transaction under the AIM Rules forCompanies. Nothwithstanding the lock in arrangements, if the 8,300,000 Minmet shares weresold at the market price immediately prior to suspension, the total grossproceeds receivable by Minmet would be approximately £800,000 (the proceedsreceivable by Gold Oil for its shares on the same basis would be £1.45 million).The proceeds receivable by Minmet compare to a total current book value of £3.15million for the 22,950,000 Gold Oil shares and the interests in Cuba and LatinAmerica. However, Westcoast Group Limited ("Westcoast"), a 15.67% shareholder inMinmet, has guaranteed to make good any loss to the Company ("the WestcoastGuarantee"). The Westcoast Guarantee will be secured by a charge over certainassets which will, in the opinion of Minmet's board, be sufficient to cover theCompany's maximum possible loss under the Transaction. Given Westcoast'sshareholding in Minmet, the Westcoast Guarantee is also regarded as a relatedparty transaction under the AIM Rules for Companies. Commenting on the Transaction, Peter Maddocks, Chairman of Minmet, said: "The opportunities which we are currently reviewing in the U.S. have acted as acatalyst for the companies to terminate the arrangements agreed in February ofthis year. Minmet had not previously intended to divest itself of its interestsin Cuba and Latin America arising from agreements with Gold Oil, but in thepresent circumstances, the arrangements in place were no longer appropriate". Accordingly, the directors of Minmet consider, having consulted with theCompany's Nominated Adviser, that in all the circumstances, the terms of theTransaction are fair and reasonable insofar as the Company's shareholders areconcerned. In addition, Peter Gardener, who is the only director considered by theCompany's board to be independent with respect to Westcoast, considers, havingconsulted with the Company's Nominated Adviser, that in all the circumstances,the terms of the Westcoast Guarantee are fair and reasonable insofar as theCompany's shareholders are concerned. Minmet's shares have been suspended since 11th October 2007 pending thisannouncement. Consequently, Minmet has requested that trading in the Company'sshares be resumed immediately. Shareholder Notifications On 20th August 2007, the Company announced that Westcoast and Ridgelane Limited("Ridgelane") together acquired, on the same day, 6,900,000 ordinary shares ofEuro 0.01 cents each in the capital of the Company at a price of 18 pence pershare, which represented a 44% premium over the then mid-market share price of12.5 pence. The interest purchased represents a holding of 7.48% in theCompany's issued share capital. On 14th September 2007, the Company received notification that the 6,900,000ordinary shares had been apportioned equally on the same day between Westcoastand Ridgelane and that Westcoast had simultaneously placed its entireshareholding, leaving it with no residual shares in the Company, and Ridgelaneholding 3,450,000 ordinary shares, representing a holding of 3.74% in theCompany's issued share capital. On 2nd October 2007, the Company received notification that, on the same day,Westcoast had acquired a total of 14,450,000 ordinary shares of Euro 0.01 centseach in the capital of the Company from Gold Oil and its subsidiary Gold OilCaribbean Limited, at a price of 18 pence per share, which represented an 86.9%premium over the closing mid-market share price of 9.63 pence on that day. Theinterest purchased represents a holding of 15.67% in the Company's issued sharecapital. For further information, please contact: Peter Maddocks, Chairman, Minmet plc +44 (0) 07846 587208 Nabarro Wells & Co. Limited, Nominated Adviser +44 (0) 20 7710 7400Robert Lo/Richard Swindells This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
BOIL.L