Michelmersh Brick Holdings PLC
23 May 2007
For release at 7.00am 23 May 2007
Michelmersh Brick Holdings plc ('Michelmersh')
Loan by W E Black Limited
Michelmersh announced on 21 May 2007 that it had acquired a total of 9,547,869
shares in Baggeridge Brick PLC ('Baggeridge') representing 23.12 per cent of the
issued share capital of Baggeridge.
Michelmersh also confirmed on 17 May 2007 that it was considering its position
with respect to its shareholding, including the possibility of making an offer
for the entire issued share capital of Baggeridge and that such an offer would
comprise a full cash offer with a partial share alternative. Michelmersh is
continuing to seek support for a possible cash offer.
As part of the financing of the Baggeridge share purchases, and any possible
offer for Baggeridge, Michelmersh announces that it has entered into a loan
agreement with W.E. Black Limited ('W.E. Black') dated 22 May 2007. W.E. Black
is a company in which Mr Eric Gadsden, Chairman of Michelmersh, has a
significant beneficial interest and that consequently this constitutes a related
party transaction within the meaning of the AIM Rules. The loan agreement
formalises the terms upon which the Company received an initial loan of £11.5
million from W.E. Black on 16 April 2007.
The loan is for £16.5 million, with an interest rate equivalent to that
attaching to the Company's existing term loan with Barclays Bank Limited
(currently 7.0 per cent). The loan is repayable at will by Michelmersh and,
save in certain circumstances of default, on 90 days' notice from W.E. Black.
W.E. Black has also confirmed that in the event that an offer for Baggeridge
were subsequently made by Michelmersh it would be prepared to make further
facilities available to Michelmersh as part of the financing of such an offer.
The directors of Michelmersh (with the exception of Mr Gadsden who has abstained
by reason of his association with W.E. Black), having consulted with Charles
Stanley Securities as the nominated adviser to Michelmersh, consider that the
terms of the loan to Michelmersh from W.E. Black are fair and reasonable insofar
as Michelmersh's shareholders are concerned.
Enquiries:
Charles Stanley Securities 020 7149 6000
Russell Cook, Anthony Noakes
Tavistock Communications 020 7920 3150
Jeremy Carey, Richard Sunderland
This information is provided by RNS
The company news service from the London Stock Exchange