Business
Grant of a Call Option
Grant of a Call Option.
About this update from Mpac Group Plc
[{"type":"text","content":"\n Molins PLC\n29 February 2008\n\n\n\n\n\n29 February 2008\n FOR IMMEDIATE RELEASE\n\n\n MOLINS PLC\n\n\n Grant of a call option re the Disposal of the Saunderton Property (the \n 'Disposal')\n\n\nOn 18 July 2007, the Board of Molins PLC ('Molins') announced that it had\nconditionally agreed to dispose of the tobacco machinery site at Haw Lane,\nSaunderton (the 'Property') to e-shelter facility services GmbH (the 'Purchaser\n') for a cash consideration, if the transaction had completed, of £18.85m. This\noriginal agreement has now been cancelled by mutual consent.\n\nA new conditional agreement (the 'Disposal Agreement') dated 28 February 2008,\nbetween Molins and the Purchaser, has now been entered into which takes the form\nof a call option to purchase the Property, exercisable by the Purchaser on or\nbefore 30 September 2008 with completion on or before 3 October 2008, for a cash\nconsideration of £17.5m. After estimated transaction expenses of £0.4m and tax\non capital gains of £1.4m, net cash proceeds would be approximately £15.7m.\n\nThe Disposal Agreement contains a number of the same commercial terms as the\nprevious agreement, including the lease back of buildings on a rent free basis\nfor up to three years. However, a number of terms have been amended. In\nparticular, all environmental contamination remediation obligations in respect\nof the Property will become the responsibility of the Purchaser on completion in\nreturn for which the cash consideration has been reduced to £17.5m.\n\nThe Disposal Agreement also incorporates the call option noted above and\ndisapplies all previous conditions, except for that relating to Molins obtaining\nthe approval of its Shareholders to complete the Disposal, as set out below.\n\nAs at 31 December 2007, the Property had a net book value of £13.2m and an\nassociated deferred tax liability of £0.6m, resulting in a net carrying value of\n£12.6m at that date.\n\nIn the year ended 31 December 2007, the Group earned income from third parties\nfrom the Property of £0.2m before tax, prior to the allocation of central costs\nand specific operating costs relating to the leased buildings. Net of specific\noperating costs, the Property generated profit from third parties of £0.1m in\nthe year ended 31 December 2007.\n\nIf the sale of the Property is completed, the net proceeds of th...