Tavistock Investments PLC Proposed Reduction of Share Premium Account (0736A)
December 22 2017 - 1:00AM
UK Regulatory
TIDMTAVI
RNS Number : 0736A
Tavistock Investments PLC
22 December 2017
Tavistock Investments plc
Proposed Reduction of Share Premium Account
Notice of General Meeting
22 December 2017
Tavistock Investments plc ("Tavistock" or "Company") announces
that it is today posting to shareholders a notice of general
meeting to consider a proposal that will facilitate the payment of
dividends to shareholders.
The Company currently has negative distributable reserves and is
therefore prohibited under the Companies Act from making
distributions, including dividends, to its shareholders. This
deficit arose predominantly as a consequence of the unsuccessful
trading activities of the Company's former business, SocialGo.
In light of the progress made to date by the Company in building
a financial services group, the Board believes it is an appropriate
time to seek approval to utilise GBP23 million of the Company's
share premium account to eliminate the deficit on the Company's
profit and loss account and create distributable reserves (the
"Capital Reduction").
The Capital Reduction is conditional upon, amongst other things,
the Company obtaining Shareholder approval at a general meeting
which will be held at 11:00 a.m. on Tuesday 16(th) January 2018 at
1
Bracknell Beeches, Old Bracknell Lane, Bracknell, RG12 7BW
("General Meeting").
Background to and details of the Capital Reduction
One of the Company's stated objectives has been to introduce,
and subsequently to manage, a dividend stream for the benefit of
Shareholders. Whilst there can be no certainty that a dividend will
be paid, the board of Tavistock now considers it prudent to take
the necessary steps to enable the Company to pay a dividend if and
when it is considered appropriate to do so.
At 30 September 2017, being the date of the Company's most
recent unaudited interim balance sheet, the Company had a profit
and loss account deficit of GBP22.3 million. At the same date, the
balance standing to the credit of the Company's share premium
account amounted to GBP27.88 million. The Capital Reduction, if
approved and made effective, will be sufficient to eliminate the
deficit entirely and create distributable reserves.
The Capital Reduction is proposed to be effected by reducing the
Share Premium Account by GBP23 million which will, subject to the
discharge of any undertakings required by the High Court of Justice
in England and Wales (the "Court") as explained below, be
sufficient to eliminate the deficit on the profit and loss account.
As a result, any positive distributable reserves generated by the
Company after the date on which the Capital Reduction takes effect
would be available for the Board to use for the purposes of paying
dividends.
In addition to the approval by Shareholders of the resolution to
be proposed at the General Meeting, the Capital Reduction requires
the approval of the Court. Accordingly, following the General
Meeting, an application will be made to the Court in order to
confirm and approve the Capital Reduction.
In providing its approval of the Capital Reduction, the Court is
likely to require protection for the creditors (including
contingent creditors) of the Company whose debts remain outstanding
on the relevant date, except in the case of creditors which have
consented to the Capital Reduction. Any such creditor protection
may include seeking the consent of the Company's creditors to the
Capital Reduction or the provision by the Company to the Court of
an undertaking to deposit a sum of money into a blocked account
created for the purpose of discharging the non-consenting creditors
of the Company.
It is anticipated that the Capital Reduction will become
effective in the first quarter of 2018 following the necessary
registration of the Court Order at Companies House.
There will be no change in the number of the Company's ordinary
shares in issue (or their nominal value) following the
implementation of the Capital Reduction and no new share
certificates will be issued as a result of the Capital Reduction.
The Capital Reduction itself will not involve any distribution or
repayment of capital or share premium by the Company and will not
reduce the underlying net assets of the Company. The distributable
reserves arising on the Capital Reduction will, subject to the
discharge of any undertakings required by the Court, support the
Company's ability to pay dividends, should circumstances in the
future make it desirable to do so.
It should be noted that the Capital Reduction does not however
guarantee the payment of a dividend to Shareholders.
Anticipated timetable of events in relation to the Capital
Reduction
Publication of this notice 22(nd) December
of General Meeting 2017
Latest time and date for receipt 11:00 a.m. on 12(th)
of Forms of Proxy for the General January 2018
Meeting
General Meeting 11:00 a.m. on 16(th)
January 2018
Expected date of initial directions 2(nd) February
hearing of the Court 2018
Expected date of Court Hearing 13(th) February
to confirm the Capital Reduction 2018
Expected effective date for 14(th) February
the Capital Reduction 2018
Enquiries:
Tavistock Investments Tel: 01753 867000
Plc
Oliver Cooke, Brian Raven
Arden Partners Plc Tel: 020 7614 5900
William Vandyk
Allenby Capital Limited Tel: 020 3328 5656
Nick Naylor, Nick Athanas
Templars Communications Tel: 020 3890 8118
Limited
Kitty Parry, Elspeth
Rothwell
This information is provided by RNS
The company news service from the London Stock Exchange
END
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