REG - Gusbourne PLC - Notice of General Meeting

GusbourneAnnouncement

19/02/2025 07:15

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RNS Number : 6010X  Gusbourne PLC  19 February 2025

THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION AS STIPULATED UNDER THE UK
VERSION OF THE MARKET ABUSE REGULATION NO 596/2014 WHICH IS PART OF ENGLISH
LAW BY VIRTUE OF THE EUROPEAN (WITHDRAWAL) ACT 2018, AS AMENDED.  ON
PUBLICATION OF THIS ANNOUNCEMENT VIA A REGULATORY INFORMATION SERVICE, THIS
INFORMATION IS CONSIDERED TO BE IN THE PUBLIC DOMAIN.

19 February 2025

Gusbourne Plc

("Gusbourne" or the "Company")

Proposed cancellation of admission of Ordinary Shares to trading on AIM

Re-registration as a private limited company

Adoption of New Articles

And

Notice of General Meeting

On 10 February 2025, Gusbourne Plc (AIM: GUS), the premium English still and
sparkling wine producer, announced that Belize Finance Limited, which is
controlled by Lord Ashcroft, holding an interest in 40,628,009 Ordinary
Shares, representing 66.8% of the issued share capital in the Company,
requisitioned the holding of a general meeting of the Company to consider the
cancellation of admission of the Company's Ordinary Shares to trading on AIM
of the London Stock Exchange. The Board has concluded that this proposal is in
the best interests of the Company and its Shareholders. Further information is
set out in this announcement and a circular (the "Circular") which will be
sent to Shareholders later today.

Accordingly, the Board are proposing the cancellation of trading of the
Company's ordinary shares of £0.01 each ("Ordinary Shares") from trading on
AIM (the "Cancellation"), re-registration of Gusbourne as a private company
(the "Re-Registration") and the adoption of new articles of association (the
"New Articles") (together with the Cancellation and Re-Registration and the
New Articles, the "Proposals").

Notice of General Meeting

The proposed Cancellation is conditional, pursuant to Rule 41 of the AIM
Rules, upon the approval of not less than 75 percent of the votes cast by
shareholders at a general meeting. The Company is therefore convening a
general meeting at 9.30 a.m. on 7 March 2025 at the offices of Fieldfisher LLP
at Riverbank House, 2 Swan Lane, London EC4R 3TT (the "General Meeting").

The Company will today publish the Circular to give notice of the General
Meeting. Action to be taken by shareholders is set out on pages 11-12 of the
Circular. The Circular will shortly be published on the Company's website at
http://www.gusbourneplc.com (http://www.gusbourneplc.com/)

If the Cancellation Resolution is passed at the General Meeting, it is
anticipated that the Cancellation will become effective at 7:00 a.m. on 19
March 2025.

Background and reasons for the proposed Cancellation

 

Since the Company's receipt of the requisition on 7 February 2025, the
Directors have conducted a careful review of the benefits and drawbacks to the
Company and the Shareholders in retaining the Company's quotation on AIM and
believe that the Cancellation is in the best interests of the Company and the
Shareholders as a whole.

 

In reaching this conclusion, the Board has considered the following key
factors amongst others:

(a)          Costs and Regulatory Burden:  The considerable cost and
management time and the legal and regulatory burden associated with
maintaining the Company's admission to trading on AIM are, in the Board's
opinion, disproportionate to the benefits of the Company's continued admission
to trading on AIM.  Given the lower costs associated with unlisted company
status, it is estimated that the Cancellation will materially reduce the
Company's recurring administrative and adviser costs by at least £250,000 per
annum, which the Board believes would be a significant reduction in overhead
cost burden;

(b)          Lack of liquidity:  The Directors believe the current
levels of liquidity in trading of the Company's Ordinary Shares on AIM do not,
in itself, offer Shareholders the opportunity to trade in meaningful volumes
or with frequency within an active market;

(c)          Market volatility:  As a result of the limited
liquidity of Ordinary Shares described above, small trades in Ordinary Shares
can have a significant impact on price and, therefore, market valuation which,
the Board believes, in turn has a materially adverse impact on: (a) the
Company's status within its industry; (b) the perception of the Company among
its customers, suppliers and other partners; (c) staff morale; and (d) the
Company's ability to seek appropriate financing or realise an appropriate
value for any material future sales or disposals;

(d)          Strategic flexibility:  The Board believes that an
unlisted company can take and implement decisions more quickly than a company
which is publicly traded as a result of the more flexible regime that is
applicable to a private company;

(e)          Governance:  In the event of Cancellation, the Board
size will be decreased and appropriate high standards and procedures of
corporate governance for a private company will be adopted, which is expected
to reduce costs for the Company; and

(f)           Future Trading of Shares:  The Company will be making
arrangements for Shareholders to freely transfer their shares periodically via
an auction-based secondary market trading facility.

 

Therefore, following careful consideration, the Board believes that it is in
the best interests of the Company and its stakeholders to seek the proposed
Cancellation at the earliest opportunity in line with AIM Rule 41, along with
Re-Registration and associated adoption of the New Articles.

 

Board and Governance

 

In the event of Cancellation, it is expected that there will be several
changes made to the Gusbourne Board as Non-Executive Chairman Jim Ormonde and
other Non-Executive Directors Ian Robinson and Lord Arbuthnot will step down.
Gusbourne would like to thank them all for their unwavering dedication,
leadership and support throughout their tenures while Gusbourne was a public
company. They leave strong foundations in place that provide a smaller,
focussed Board the opportunity to take strategic decisions to drive long-term
growth in the future.

 

In the event of Cancellation, Simon Bradbury will also step down from the
Gusbourne Board, but Simon will continue to be an integral and invaluable key
executive within the management group, maintaining his role as a key leader
and decision maker within the business.

 

In the event of Cancellation, the Governance of the delisted company will be
reviewed by the Gusbourne Board, with consideration of all shareholder
requirements.

 

Expected Timetable of Principal Events

 

 Announcement of Cancellation                                                    19 February 2025

 Publication and posting of the circular                                         19 February 2025

 Latest time and date for receipt of online proxy votes or completed Forms of
 Proxy in respect of

 the General Meeting

                                                                                 9.30 a.m. on 5 March 2025

 General Meeting                                                                 9.30 a.m. on 7 March 2025

 Expected last date and time for trading in Ordinary Shares on AIM               6.00 p.m. on 18 March 2025

 Expected date of Cancellation                                                   7.00 a.m. on 19 March 2025

 Secondary Market Trading Facility for Ordinary Shares commences                 19 March 2025

 Expected date of Re-registration                                                By 5 April 2025

Secondary Market Trading Facility

The Directors are aware that certain Shareholders may be unable or unwilling
to hold Ordinary Shares in the event that the Cancellation is approved and
becomes effective. Should the Cancellation become effective, the Company
intends to implement a secondary market trading facility with a third party
which would facilitate Shareholders buying and selling Ordinary Shares on a
matched bargain basis following Cancellation.

The secondary market trading facility will be provided by JP Jenkins and will
be reviewed on an annual basis. JP Jenkins is an appointed representative of
Prosper Capital LLP, which is authorised and regulated by the FCA.

Under the Matched Bargain Facility, Shareholders or persons wishing to acquire
or dispose of Ordinary Shares would be able to leave an indication with JP
Jenkins, through their stockbroker (JP Jenkins is unable to deal directly with
members of the public), of the number of Ordinary Shares that they are
prepared to buy or sell at an agreed price. In the event that JP Jenkins is
able to match that order with an opposite sell or buy instruction, it would
contact both parties and then effect the bargain (trade). Shareholdings remain
in CREST and can be traded during normal business hours via a UK regulated
stockbroker.

Should the Cancellation become effective and the Company puts in place the
secondary market trading facility, details will be made available to
Shareholders on the Company's website and directly by letter or e-mail (where
appropriate). The Secondary Market Trading Facility is expected (but is not
certain) to operate for a minimum of 12 months after the Cancellation. The
Directors' current intention is that it will continue beyond that time, but
Shareholders should note that there remains a risk that the Matched Bargain
Facility may not have been put in place at the time of Cancellation, or if it
is, it could be withdrawn and therefore inhibit the ability to trade the
Ordinary Shares.

Further information about the secondary market trading facility, including
indicative prices and a history of transactions, will be available on the JP
Jenkins website which is located at www.jpjenkins.com
(http://www.jpjenkins.com) .

Recommendation

For the reasons noted above, the Directors consider that the resolutions to be
put forward at the General Meeting are in the best interests of the Company
and its stakeholders as a whole and therefore unanimously recommend that
shareholders vote in favour of all of the resolutions to be proposed at the
General Meeting, as the Directors intend to do in respect of their own
aggregate holdings of 1,174,659 Ordinary Shares, representing approximately
1.9 per cent. of the Company's issued share capital as of today's date.

Capitalised terms used but not defined in this announcement shall have the
same meanings as are given to such terms in the Circular.

For further information contact:

 Gusbourne Plc
 Jonathan White, CEO                                        +44 (0)12 3375 8666

 Katharine Berry, CFO/COO
 Phil Clark, Investor Relations

 Panmure Liberum Limited (Nomad and Sole Broker)
 James Sinclair-Ford / Ailsa Macmaster                      +44 (0)20 7886 2500
 Tom Scrivens

 Media:
 Kate Hoare / Ben Robinson / India Spencer (Houston)        +44 (0)20 4529 0549

 gusbourne@houston.co.uk (mailto:gusbourne@houston.co.uk)

APPENDIX 1

Extracts from the Circular Shareholders are encouraged to read the Circular in
its entirety

Trading update and strategy

The Gusbourne business was founded by Andrew Weeber in 2004 with the first
vineyard plantings at Appledore in Kent.  Shellproof Plc acquired Gusbourne
Estate business and assets and was admitted on AIM in May 2008. Shellproof plc
subsequently changed its name to Gusbourne plc.

Over recent years the Company has made a number of successful inroads against
Gusbourne's long-term strategy to cement its position as a leading producer of
high-quality English still and sparkling wines, with its well-established
brand, expansion into international markets, and carefully managed
distribution. However, the challenging market backdrop has weighed heavily on
the pace of financial progress.

The UK trade market for the Company's wines, which represented approximately
44% of sales in 2024, continues to be extremely challenging, with the UK
economy stalled and business confidence remaining low, whilst the tax burden
on UK businesses is rising. Good progress has been made to offset this
deterioration through new revenue gained in our direct to consumer channel and
the Company's growing Corporate and Partnerships channel.  To drive revenue
growth in UK trade the Company recently signed an innovative distribution
partnership that is expected to broaden the Company's market reach. However,
the Board recognises it will take time for this initiative to drive
significant momentum, particularly in the current market environment.

Despite the difficult trading backdrop, the Board believes that the current
share price significantly undervalues the assets and long-term outlook of the
business. Gusbourne's mature vineyards and prestigious brand represent
high-quality and detail-focussed winemaking. Gusbourne is internationally
recognised for excellence in super-premium and luxury wines and the routes to
market for our products are well established for longer-term growth
opportunities.

Net revenue growth in 2023 was 13%, down from a 49% net revenue growth in
2022. In 2024 the Company's revenue growth was relatively flat, with modest H2
revenue growth reversing a H1 revenue decline. Limited net revenue growth in
the last two years has adversely impacted EBITDA and working capital, which
has in turn impacted our cash flow, and the Company's cash position continues
to remain tight with working capital remaining available into Q2 2025, despite
significant operating cost savings being achieved.

The Company remains dependent on the support of its secured Bond holder, who
is also the largest shareholder representing 66.76% of the Company's issued
share capital. At 31 December 2024 the Company's Bond liability including
accrued discount at that date amounted to £22,567,000. The Bond together with
accrued discount is repayable on maturity on 12 August 2027, unless redeemed
early. The Bond was issued at a discount rate of 7.75% per annum.

The Directors consider the cost benefits and flexibility of delisting gives
the Company the most advantageous environment to help focus on the promotion
of the Company's growth and maximise potential shareholder value, as well as
the Company's longer-term prospects, for the benefit of all stakeholders in
the Company, including its Bond holder, shareholders, customers and loyal
employees.

Process for, and principal effects of, the Cancellation

 

Under the AIM Rules, it is a requirement that Cancellation must be approved by
not less than 75 per cent. of votes cast by shareholders at a general meeting.
Accordingly, the Notice of General Meeting set out in Part IV of this Circular
contains a special resolution (Resolution number 1) to approve the
Cancellation.

 

Furthermore, Rule 41 of the AIM Rules requires any AIM company that wishes the
London Stock Exchange to cancel the admission of its shares to trading on AIM
to give at least 20 clear Business Days notice of the Cancellation. In
accordance with AIM Rule 41, notice was given on 19 February 2025, subject to
the Cancellation Resolution being passed at the General Meeting, to cancel the
Company's admission of the Ordinary Shares to trading on AIM on 19 March 2025.

 

Shareholders should note that last day of trading in the Ordinary Shares on
AIM will be 18 March 2025 and that the Cancellation will take effect at 7.00
a.m. on 19 March  2025. The Directors are aware that certain Shareholders may
be unable or unwilling to hold Ordinary Shares in the event that the
Cancellation is approved and becomes effective. Such Shareholders should
consider selling their interests in the market prior to the Cancellation
becoming effective.

 

The principal effects of the Cancellation will be that:

(a)          as a private company, there will no longer be a formal
market mechanism enabling Shareholders to trade their Ordinary Shares on AIM
(or any other recognised market or trading exchange);

(b)          the Ordinary Shares are likely to be more difficult to
sell compared to shares of companies traded on AIM. It is possible that,
following the publication of this Circular, the liquidity and marketability of
the Ordinary Shares is reduced and their value adversely affected. However, as
set out above, the Directors believe that the existing liquidity in the
Ordinary Shares is in any event limited;

(c)          in the absence of a formal market and quoted price it
may be more difficult for Shareholders to determine the market value of their
investment in the Company at any given time;

(d)          the Company will no longer be subject to the AIM Rules
and, accordingly, Shareholders will no longer be afforded the protections
given by the AIM Rules. In particular, the Company will not be bound to:

·    make any public announcements of material events, or to announce
interim or final results;

·    comply with any of the corporate governance practices applicable to
AIM companies;

·    announce substantial transactions and related party transactions; or

·    comply with the requirement to obtain shareholder approval for
reverse takeovers and fundamental changes in the Company's business;

(e)          the Company will no longer be subject to UK MAR
regulating inside information and other matters;

(f)           the Company will no longer be required to publicly
disclose any change in major shareholdings in the Company under the Disclosure
Guidance and Transparency Rules;

(g)          the Company will cease to retain a nominated adviser and
broker;

(h)          whilst the Company's CREST facility will remain in place
immediately following the Cancellation the Company's CREST facility may be
cancelled in the future and, although the Ordinary Shares will remain
transferable, they may cease to be transferable through CREST (in which case,
Shareholders who hold Ordinary Shares in CREST will receive share
certificates);

(i)           stamp duty will be due on transfers of shares and
agreements to transfer shares unless a relevant exemption or relief applies to
a particular transfer; and

(j)           the Cancellation and Re‐registration may have
personal taxation consequences for Shareholders. Shareholders who are in any
doubt about their tax position should consult their own professional
independent tax adviser.

 

The above considerations are not exhaustive, and Shareholders should seek
their own independent advice when assessing the likely impact of the
Cancellation on them.

 

The Company currently intends that it will continue to provide certain
facilities and services to Shareholders that they currently enjoy as
shareholders of an AIM company following the proposed Cancellation. It is
intended that the Company will continue to:

(a)          communicate information about the Company (including
annual accounts) to its Shareholders, as required by law;

(b)          maintain its website and to post updates on the website
from time to time, although Shareholders should be aware that there will be no
obligation on the Company to include all of the information required under AIM
Rule 26 or to update the website as required by the AIM Rules.

(c)           remain subject to the Takeover Code for two years
following Cancellation as further set out in part  8  below; and

(d)          seek to make available to Shareholders, through JP
Jenkins the secondary market trading facility (as further described in Part
 4  above) which would allow Shareholders to buy and sell Ordinary Shares on a
matched bargain basis following the Cancellation.

 

Action to be taken
 
Hard copy proxy forms are being sent to Shareholders in connection with the General Meeting although the Company would like to encourage Shareholders to vote electronically or appoint a proxy electronically, which can be done via the Investor Centre app or web browser at
uk.investorcentre.mpms.mufg.com (https://uk.investorcentre.mpms.mufg.com/)
 or, where Ordinary Shares are held in CREST, via CREST. Institutional investors may also be able to appoint a proxy electronically via the Proxymity platform.  Notwithstanding the method of appointment, proxy appointments must be received by MUFG Corporate Markets by 9.30 a.m. on 5 March 2025, being 48 hours (excluding non-working days) before the time fixed for the General Meeting. Further details of the proxy appointment methods are set out in the Notice of General Meeting. The appointment of a proxy will not preclude Shareholders from attending and voting in person at the General Meeting should they wish to do so.

Shareholders are encouraged to appoint the chair of the General Meeting as their proxy with directions as to how to cast their vote on the Resolutions proposed. For further details on how to submit a proxy vote, see the notes to the Notice of General Meeting at Part IV of this Circular.

The appointment of a proxy will not preclude Shareholders from attending and voting in person at the General Meeting should they wish to do so.

 

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