Shareholder Update, Placing and Notice of GM

RNS Announcement: The information communicated in this announcement contains inside information for the purposes of Article 7 of Regulation 596/2014.

WH Ireland Group Plc

(“WH Ireland” or the “Company”)

Shareholder Update

Placing of new Ordinary Shares

Notice of General Meeting

Shareholder Update

The Board of WH Ireland has noted the release of the TR1s confirming a change of shareholdings in the Company.

Mr Abdulaziz Al-Bader; Mr Waleed Al-Thaqeb and Mr Thamer Al-Wazzan have confirmed they have sold their entire holdings in WH Ireland and accordingly no longer hold any shares in WH Ireland.

At the same time, Oceanwood Capital Management Limited has notified the Company that it has acquired 2,300,000 Ordinary Shares in the Company, increasing its total holding to 7,634,214 Ordinary Shares (representing 25.56% of the issued share capital of the Company); Polygon Global Partners Limited has notified the Company that it has acquired 500,000 Ordinary Shares in the Company increasing its total holding to 8,762,126 Ordinary Shares (representing 29.33% of the issued share capital of the Company) and M&G Investments Limited has notified the Company it has acquired 3,725,079 Ordinary Shares in the Company, being its first holding in the Company (representing 12.47% of the issued share capital of the Company).

Placing of new Ordinary Shares

The Company is also pleased to announce that it has conditionally raised £2,000,000 from the issue of 2,000,000 new ordinary shares of 5p each (“New Ordinary Shares“) at a price of 100p per share (the “Placing“).

Background to and Reasons for the Placing

Following a broad review of the Group’s likely future regulatory capital requirements and in particular, the Group’s regulatory capital planning buffers, the directors believe that the Placing, in addition to the existing ongoing corporate activities of the Company, will ensure that the Group has sufficient resources in place to satisfy the FCA’s present capital adequacy requirements.

In addition, completion of the Placing would increase the Group’s core tier 1 capital ratio, which is a key measure of the Group’s financial stability and strength for market regulators and investors.

The Directors believe that the Placing is the most cost effective and certain method to raise funds at this time, avoiding the significant costs and uncertainty associated with a public offering requiring a prospectus.

Placing Participants

As part of the Placing, Oceanwood Capital Management Limited has conditionally subscribed for 600,000 New Ordinary Shares, which, if approved by shareholders would increase its total holding to approximately 8,234,214 Ordinary Shares representing 25.84% of the Company’s then Enlarged Share Capital; Polygon Global Partners Limited has conditionally subscribed for 600,000 New Ordinary Shares, which would increase its total holding to 9,362,126* Ordinary Shares representing 29.37% of the Company’s then Enlarged Share Capital; and M&G Investments has conditionally subscribed for 800,000 New Ordinary Shares which would increase its total holding to approximately 4,525,079 Ordinary Shares representing 14.20% of the Company’s then Enlarged Share Capital.

Commenting on the Placing, Tim Steel, Chairman of WH Ireland said “We greatly appreciate the support of our major shareholders Polygon and Oceanwood and we welcome our new institutional shareholder M&G to the Company. We look forward to a strong partnership with all our shareholders as we develop the business going forward.”

*in addition, Polygon has a contract for difference in respect of 110,278 Ordinary Shares and accordingly following the issue of the Placing Shares, at Admission would be interested in, or hold exposure to, 9,472,404 voting rights in the Company (being 29.72% of the total voting rights) on the assumption that no further shares are issued other than the Placing Shares and assuming the contract for difference remains in place.

Additional Details

The Placing is conditional, amongst other things, on:

•     the passing of the resolutions to be proposed at the Company’s general meeting referred to below; and

•     Admission of the New Ordinary Shares becoming effective by no later than 8.00 a.m. on 10 October 2018 (or such later time and/ or date as the Company may specify by an announcement to a Regulatory Information Service, being no later than 5.30 p.m. on 30 October 2018). 

The Placing is not being underwritten and the New Ordinary Shares are not being made available to the public. 

Application will be made to London Stock Exchange plc for the New Ordinary Shares to be admitted to trading on AIM. Subject to the satisfaction of the conditions referred to above, it is expected that admission will be effective, and dealings in the New Ordinary Shares will commence, at 8.00 a.m. on 10 October 2018.

The New Ordinary Shares will, when issued, rank pari passu in all respects with each other and with the existing ordinary shares in the capital of the Company, including the right to receive all dividends and other distributions declared, made or paid in respect of the ordinary shares after the date of issue of the New Ordinary Shares.

Current Trading and Outlook

The Company announced a current trading update on 19 July 2018, as part of its Final Results for the 16 months ended 31 March 2018, which includes the following:

·      Market activity was subdued in the extra four months from November 2017 to March 2018 impacting the Corporate and Institutional Broking (CIB) division. 

·      The Wealth Management (WM) division has benefited from higher market levels but it has borne higher costs than anticipated. These costs primarily relate to the outsourcing of our custody and operational functions and legacy issues which have taken longer to resolve than anticipated. This represents the final element of the investment in transformational change within the WM division and will result in a significant decline in these costs within this new financial year.

·      In the new financial year that started on 1 April 2018, both divisions have witnessed better trading conditions and are beginning to see the benefits of all the changes that have been made to the business in the last few years.

·      The CIB division has undertaken a number of transactions for corporate clients and we have begun to see the positive impact of the wider cost reduction and revenue enhancement programmes within the WM division; and

·      Fee income (CIB retainers, WM management and advice fees) is now running at approximately £1.3 million a month, representing nearly 55% of our total monthly revenue. This is the highest ratio of fees to total revenue ever achieved by the business and is most encouraging for the progression of WH Ireland in the future.

Related Party Transactions

As Polygon and Oceanwood are substantial shareholders in the Company, this transaction is considered to be a related party transaction under the AIM Rules for Companies. The directors of the Company having consulted with the Company’s Nominated Adviser, SPARK Advisory Partners Limited, consider that the terms of the transaction are fair and reasonable insofar as the shareholders are concerned.

Notice of General Meeting

The Company also confirms that today it has dispatched a notice of general meeting to convene a meeting of shareholders at 24 Martin Lane, London EC4R 0DR at 10.00 a.m. on 9 October 2018 for the purpose of considering and, if thought fit, passing certain resolutions to give effect to the Placing.

Additional Information

For the purposes of the Financial Conduct Authority’s Disclosure, Guidance and Transparency Rules the issued ordinary share capital of the Company following Admission, assuming no other shares are issued by the Company, will consist of 31,871,276 Ordinary Shares with voting rights attached (one vote per Ordinary Share).

For further information please contact:

WH Ireland Group plc                                                                          www.wh-ireland.co.uk

Phillip Wale, Chief Executive Officer (elect)                                              +44(0) 20 7220 1666