Location Sciences - Loan Agreement, Proposed Acquisition & Suspension
28/06/2023 07:00
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RNS Number : 1067E Location Sciences Group PLC 28 June 2023
28 June 2023
This announcement contains inside information for the purposes of Regulation
11 of the Market Abuse (Amendment) (EU Exit) Regulations 2019/310. With the
publication of this announcement via a Regulatory Information Service, this
inside information is now considered to be in the public domain.
Location Sciences Group PLC
("Location Sciences" or the "Company" or the "Group")
Convertible Loan Agreement with Sorted Holdings Limited and suspension of
share trading on AIM
Location Sciences (AIM: LSAI), the location data insight and verification
company, announces that the Company has entered into a secured convertible
bridge loan agreement (the "Convertible Loan Agreement") with Sorted Holdings
Limited ("Sorted"), a leading ecommerce delivery experience platform, to lend
it up to £2.6 million.
The Company also announces that it has entered into exclusive non-binding
heads of terms regarding a potential acquisition of the entire issued share
capital of Sorted by the Company for a nominal consideration of £1.00 (the
"Proposed Acquisition"). It is anticipated that as part of the Proposed
Acquisition, the Company will assume approximately £4.0m of Sorted's
outstanding debt. It is also intended that if the Proposed Acquisition
proceeds, existing subscribers, including shareholders of Sorted, will at the
same time be given the opportunity to participate in a cash subscription for
up to £5m of new shares in Location Sciences to seek to align their interests
with those of existing Location Sciences shareholders. The Proposed
Acquisition would constitute a reverse takeover under the AIM Rules for
Companies.
The Proposed Acquisition remains subject to a number of factors, including the
completion of due diligence and negotiations to the Company's satisfaction,
and, as such, there can be no certainty that a final binding agreement will be
reached.
Convertible Loan Agreement
The Company has agreed to provide Sorted with a secured bridge loan facility
of up to £2.6 million (the "Loan") for working capital purposes. The Loan
will be made in such tranches as approved by the Company following request
from Sorted and is repayable on demand. The Loan has a redemption premium of
50 per cent and is secured by a first fixed and floating charge over Sorted's
business and assets granted by Sorted and its subsidiaries in favour of the
Company. At the Company's option, the Loan is convertible into shares
representing as nearly as possible 100 per cent. of the fully diluted share
capital of Sorted.
Information about Sorted
Founded more than a decade ago, Sorted provides software solutions to ease
carrier management and delivery tracking for its users, to enable
post-purchase tracking and communications and to allow automated returns
management post sale. The company is recognised as an innovative team which
delivers transformational technology on a global scale, serving more than 500
customers across the UK and US, from mid-sized, growing ecommerce businesses
to multi-national organisations.
Sorted's unaudited management accounts for the year ended 30 September 2022
state that the company generated revenues in that year of approximately £6.4m
(Year ended 30 September 2021 - £4.5m*) and a loss before tax of
approximately £14.5m (Year ended 30 September 2021 - £14.1m*). As at 30
September 2022, Sorted had total assets of approximately £32.4m (30 September
2021 - £17.2m*) and net assets of £24.7m (30 September 2021 - negative net
assets of £2.5m*).
* The financial information for the year to 30 September 2021 is audited. The
financial information for the year to 30 September 2022 remains subject to
audit adjustment and completion.
Suspension
The Proposed Acquisition would constitute a reverse takeover under rule 14 of
the AIM Rules for Companies (the "AIM Rules"). Therefore, the Proposed
Acquisition would be subject, inter alia, to the approval of Location
Sciences' shareholders. As such, a further announcement with full details of
the Proposed Acquisition would be issued at the appropriate time and an
admission document published and sent to Location Sciences' shareholders with
a notice of general meeting.
In accordance with rule 14 of the AIM Rules, the Company's ordinary shares
will be suspended from trading on AIM with effect from 7:30 a.m. today. The
Company's ordinary shares will remain suspended until such time as either an
admission document is published, or an announcement is released confirming
that the Proposed Acquisition is not proceeding.
The Company will release further announcements as and when appropriate.
For further information please contact:
Location Sciences Group
PLC
via Allenby Capital
Simon Wilkinson, Chairman
Allenby Capital Limited (Nominated
Adviser)
Tel: +44 (0)20 3328 5656
David Hart
Vivek Bhardwaj
Turner Pope Investments (TPI) Ltd
(Broker)
Tel: +44 (0)20 3657 0050
James Pope
Andy Thacker
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