Acquisition of Starneth Completed
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, DIRECTLY OR INDIRECTLY, WITHIN, INTO OR IN THE UNITED STATES, AUSTRALIA, CANADA OR JAPAN.
For Immediate Release
16 July 2015
Challenger Acquisitions Limited
("Challenger" or the "Company")
Acquisition of Starneth Completed
Challenger Acquisitions Limited (LSE: CHAL) is pleased to announce that further to the announcement on 26 May 2015 the Company has completed the acquisition of the principal operating businesses of Starneth (the "Starneth Acquisition").
Summary of the terms of the Share Purchase Agreement
On 15 July 2015, Challenger entered into a Share Purchase Agreement with Smits International B.V., Yamapro Trading - F.Z.E. and Systems Engineering International, Inc. (the "Sellers"), for the acquisition of all shares in Starneth Holding B.V. and in Starneth Europe B.V. with immediate effect. Starneth Holding B.V. and Starneth Europe B.V. own all the shares in Banka B.V., SME Engineering Services JLT, Starneth Ltd, Starneth Pte Ltd, and Starneth America LLC.
The total consideration under the Share Purchase Agreement amounts to €7.2 million plus a variable component equal to 30 per cent of the consolidated EBITDA of the acquired companies in excess of €1,267,000 for the next three financial years.
Of the consideration, €1,250,000 was paid in cash at closing, and two further cash payments of €1,250,000 will be made on the first and second anniversary of closing. The rest of the consideration will be settled in Challenger shares. A total of 1,100,000 Challenger shares were issued to the Sellers at closing (the "Starneth Shares"). Two additional instalments of 1,100,000 shares will be made on the first and second anniversary of closing, and the variable component will also be paid in Challenger shares after the end of each financial year. All Challenger shares issued to the Sellers under the Share Purchase Agreement are valued at £0.75 per share.
Mark Gustafson, the Company's Executive Chairman, said:
"The excellent quality and principled nature of the leadership team at Starneth, coupled with the pipeline of potential projects worldwide, provides a global platform in the attractions sector for Challenger. We look forward to working with Chiel and the Starneth team on multiple iconic wheel projects globally, both as the supplier and as an equity owner in select projects."
Chiel Smits, CEO of Starneth, said:
"By combining the expertise of both parties, we believe our future success will be improved significantly. Challenger is seen as a great advantage for Starneth to grow further in the worldwide business of iconic observation structures."
The Sellers have agreed not to sell or otherwise dispose any of the Challenger shares received under the Share Purchase Agreement during a period of 36 months after the closing.
No application is currently being made for the Starneth Shares to be admitted to the Official List of the UK Listing Authority and therefore the shares will not be admitted to trading on the London Stock Exchange's Main Market for listed securities. Following the issue of the Starneth Shares, the Company's total number of Ordinary Shares with voting rights is 12,449,889. There are no shares held in treasury.
Therefore the above figure of 12,449,889 may be used by shareholders as the denominator for the calculation by which they may determine if they are required to notify their interest in, or change to their interest in, the Company under the FCA's Disclosure and Transparency Rules.
The Company's shares remain suspended until further notice because, as previously announced, the investment of a total of US$3 million made by the Company for a 2.463 percentage (2.463%) interest in New York Wheel Investor LLC (the "Investment") and the Starneth Acquisition individually and collectively constitute a Reverse Takeover under the Listing Rules. Accordingly, the Company is required to re-apply for listing of its Ordinary Shares, including the Starneth Shares as noted above, to the standard listing segment of the Official List of the UK Listing Authority and for admission to trading on the London Stock Exchange's Main Market for listed securities (the "Re-Admission").
The Company is working on the preparation of a prospectus in relation to the Investment and the Starneth Acquisition. The eligibility of the enlarged group to be admitted to the Official List has not yet been agreed with the UK Listing Authority and an application regarding its eligibility will be made in due course and a further announcement regarding the Re-Admission will follow.
For more information:
|Challenger Acquisitions Limited
+1 604 454 8677
|Beaumont Cornish Limited (Financial Adviser)
|+44 (0) 20 7628 3396|