REG - Roebuck Food Group - Proposed disposal of Animal Protein Division

Roebuck FoodAnnouncement

01/08/2024 07:00

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RNS Number : 6773Y  Roebuck Food Group PLC  01 August 2024

The information contained within this announcement was previously deemed by
the Company to constitute inside information as stipulated by Market Abuse
Regulation (EU) No 596/2014 ("EU MAR") and the retained UK law version of EU
MAR pursuant to the Market Abuse (Amendment) (EU Exit) Regulations 2019 (SI
2019/310) ("UK MAR"). With the publication of this announcement via a
Regulatory Information Service, this information is now considered to be in
the public domain

Roebuck Food Group plc ("Roebuck" or "the Company")

Proposed disposal of Animal Protein Division

1 August 2024

Roebuck Food Group plc (AIM: RFG), is pleased to announce the sale of its
animal protein business ("the Disposal") to Plunkett Matthews ("the
Purchaser") for a consideration of £0.736 million. The consideration is made
up of an equity value of £0.2 million (£0.1 million payable on completion
and £0.1 million within 2 years of completion) and following the settlement
of indebtedness and the operation of a completion accounts adjustment
mechanism in the Share Purchase Agreement, this will also result in a
reduction in Group indebtedness of £0.636 million. In addition, a further
£300,000 may become payable within 5 years, subject to certain conditions.

The Disposal represents a fundamental change of business pursuant to AIM Rule
15 and as such is subject to the approval of Roebuck shareholders at an
Extraordinary General Meeting ("EGM"), currently scheduled to be held on 29
August 2024.  A circular setting out details of the Disposal and convening
the EGM will be sent to shareholders shortly.

In its annual report for 2023, the Company noted its focus on delivering
shareholder value through efficient capital allocation.  The Purchaser made
an approach to the Company, leading to discussions which have culminated in
the Disposal.

Roebuck's animal protein division, which is the subject of the Disposal, is
comprised within its wholly-owned subsidiary Townview Foods Limited,
incorporated in Northern Ireland with registered number NI035629, registered
office at 7 Carrivekeeney Road, Newry, Co. Down, BT35 7LU and principal place
of business at that address, from which it sources and procures fresh and
frozen meat protein products for supply to major food manufacturing,
wholesale, food service and retail companies across the world. For the year
ended 31 December 2023 the animal protein division generated revenue of
£24.825 million, a loss of £0.197 million, and had net assets of £0.462
million.

The Disposal results in the Group's business changing from a combination of
sourcing of animal protein, and the milling and importation of food, plant
ingredients, and dry goods, to milling and importation of food and plant
ingredients (operated through wholly-owned subsidiary) Moorhead & McGavin
Ltd acquired last year and sourcing of dry goods (operated through wholly
owned subsidiary Townview Sourcing Ltd, in course of changing its name to Foro
Food Solutions Ltd). For the year ended 31 December 2023 the Company's two
continuing operating subsidiaries Moorhead & McGavin Ltd and Townview
Sourcing Limited had revenue of £7.2 million and €3.2 million respectively

The Disposal releases the continuing Group (the Company and its subsidiaries
Moorhead & McGavin Ltd and Townview Sourcing Ltd, in course of changing
its name to Foro Food Solutions Ltd) from indebtedness in the sum of £0.636
million.

In the Share Purchase Agreement, the Company has given various warranties and
indemnities to the Purchasers, concerning (among other things) the share
capital, business, and assets of Townview Foods Limited.

As part of the transaction, Gerard Murphy will cease to be Group Finance
Director and Company Secretary of the Company and will be paid the sum of
£105,000 in lieu of notice under his service agreement (being one year's
salary).  The Directors of the Company (Mr Murphy excepted) consider, having
consulted with the Company's nominated adviser Davy, that this payment is fair
and reasonable insofar as its shareholders are concerned. He will continue as
Financial Controller of Townview Foods Limited under different terms.

Considering the amount of sale proceeds and redundancy costs associated with
the Disposal it is not anticipated that there will be net proceeds from the
transaction beyond the reduction of Group indebtedness.  Following Completion
of the Disposal, Aidan Hughes, currently Deputy Chairman (and former Finance
Director and Company Secretary) will resume the role of Finance Director of
the Group and Group Company Secretary.

The Directors consider the terms of the Disposal and related matters to be
fair and reasonable and in the best interests of the Company and its
Shareholders as a whole.

The Directors of the Company accept responsibility for the contents of this
announcement.

Enquiries:

 Roebuck                    Aidan Hughes, Deputy Chairman
                            Telephone: + 44 7808 895 515

 Davy (Nomad & Broker)      Anthony Farrell
                            Telephone: + 353 1 679 6363

 

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