MXC Capital Limited Proposed Acquisition of Loan Notes in Adept4 plc (4290O)
October 02 2019 - 1:00AM
UK Regulatory
TIDMMXCP
RNS Number : 4290O
MXC Capital Limited
02 October 2019
The information contained within this announcement is deemed by
the Company to constitute inside information stipulated under the
Market Abuse Regulation (EU) No. 596/2014. Upon the publication of
this announcement via the Regulatory Information Service, this
inside information is now considered to be in the public
domain.
MXC Capital Limited
("MXC" or the "Company")
Proposed Acquisition of Loan Notes in Adept4 plc
MXC (AIM: MXCP), the technology focused adviser and investor, is
pleased to announce that it has conditionally agreed to acquire
GBP3.5 million of unsecured loan notes (the "Loan Notes") in Adept4
plc ("Adept4"), a company in which MXC is a 29.9% shareholder.
Adept4 has announced that it has conditionally agreed to acquire
CloudCoCo Limited ("CloudCoCo") (the "Proposed Acquisition"), a
recently established provider of cloud and related technology
solutions. The consideration for the Proposed Acquisition is new
ordinary shares in Adept4. MXC, via its wholly owned subsidiary MXC
Guernsey Limited ("MXCG"), was a founder shareholder of CloudCoCo
and made an initial investment of GBP0.1 million in return for a
10.6% shareholding. As part of the Proposed Acquisition, MXCG has
agreed to sell its entire shareholding in CloudCoCo to the incoming
CEO of Adept4 plc at the same value as its original investment to
ensure he has a meaningful stake in the enlarged group going
forwards. Following completion of the Proposed Acquisition, MXC
will hold 15% of the enlarged share capital of Adept4.
Adept4 currently has GBP5.0 million of unsecured loan notes in
issue which are held by Business Growth Fund Plc ( "BGF").
Conditional upon, inter alia, completion of the Proposed
Acquisition, BGF has agreed to waive GBP1.5 million of the loan
notes and has agreed to sell the remaining GBP3.5 million loan
notes at par value to MXCG. MXCG and Adept4 have agreed to vary the
terms of the remaining loan notes such that, inter alia, their term
is extended until 2024 (though Adept4 has the ability to repay the
loan notes after 12 months) and the associated interest rate is
amended to 12%, such interest to be rolled up, compounded annually
and paid at the end of the term. Furthermore, conditional upon,
inter alia, completion of the Proposed Acquisition, MXCG has agreed
to provide Adept4 with an additional 2 year working capital
facility of up to GBP0.5 million, with an interest rate of 12% and
has agreed to cancel the outstanding warrants it holds in Adept4
(together, the "Financing Proposals").
Completion of the Proposed Acquisition and the Financing
Proposals ("Completion") is conditional on, inter alia, the
approval of Adept4's shareholders. There can be no guarantee that
the Proposed Acquisition or Financing Proposals will proceed.
MXC Capital Limited
Ian Smith
+44 (0) 20 7965 8149
Zeus Capital Limited (Nominated adviser and broker)
Nick Cowles, Dan Bate
+44 (0) 161 831 1512
About MXC Capital Limited www.mxccapital.com
MXC is a specialist technology adviser and investor with a track
record of investing in and advising companies in the TMT sector.
MXC brings together a deep knowledge of technology, first-hand
experience of managing companies in the sector, an ability to make
meaningful investments and a highly experienced corporate advisory
team in support, all of which combine to grow shareholder
value.
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END
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