REG - Unbound Group PLC - Update

UnboundAnnouncement

27/06/2023 07:15

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RNS Number : 9581D  Unbound Group PLC  27 June 2023

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THIS ANNOUNCEMENT CONTAINS INSIDE INFORMATION.

Unbound Group plc

("Unbound", the "Company" or the "Group")

Termination of Formal Sale Process and Strategic Review Update

The Company's board of directors (the "Board") provides an update further to
the initiation of the strategic review and formal sale process announced by
the Company on 19 May 2023.

Termination of Formal Sale Process

The Board announced the initiation of a strategic review and formal sale
process on 19 May 2023 to consider the options available to maximise value for
the Company's shareholders and the Group's other stakeholders. These options
included, but were not limited to, a sale of the Company conducted under the
framework of a formal sale process in accordance with the City Code on
Takeovers and Mergers (the "Code").

No potential offers for the issued and to be issued share capital of the
Company were received that the Board considered capable of receiving
shareholder and wider stakeholder support. The Board also confirms that there
are no discussions ongoing with potential offerors. The Board therefore
announces the termination of the formal sale process, which concludes the
offer period (as defined in the Code) in respect of the Company. As such, the
Company has ceased to be in an offer period as defined in the Code and the
requirement to make disclosures under Rule 8 of the Code are no longer
applicable with effect from the publication of this announcement.

Strategic Review Update

Interpath as Joint Financial Adviser continues to run the strategic review
process in respect of the Group's main operating subsidiary. Offers within
this process continue to be received and reviewed, however, these offers may
result in little or no recovery of value for the Company's existing
shareholders.

Current discussions with interested parties may be altered or terminated at
any time and, accordingly, there can be no certainty that any final proposals
will be made, nor as to the terms on which any such final proposals may be
made.

Formal Restructuring Plan and Potential Equity Fundraise

In light of the recent encouraging trading performance of the Group, as an
alternative to the indicative proposals being progressed as part of the
strategic review, the Board is also assessing the feasibility of an equity
fundraise of between £1.5 million and £2 million to support implementation
of a formal restructuring plan, with a view to securing a better outcome for
the Group. The Board, in conjunction with Singer Capital Markets as the
Company's Financial Adviser, Nominated Adviser and Broker, is engaging with
certain of the Group's major shareholders and has received some positive
feedback at this early stage, with a view to procuring broader participation
in the equity fundraise. Its implementation would be subject to the consent of
the Company's shareholders and wider stakeholders before ultimately requiring
the sanctioning of the UK Courts.

Should an equity fundraise be progressed, the Board intends to include an open
offer element to enable participation by the Company's wider shareholder base
on equal terms.

There can be no certainty that an equity raise can be achieved nor as to the
terms of any such equity raise. The Board confirms that it continues to
consider the available options and take appropriate steps to preserve value
for stakeholders in the event that further equity funding cannot be raised and
/ or a formal restructuring plan cannot be implemented.

Current Trading Update

The Group's revenues continue to be impacted by liquidity constraints. The
Group remains reliant on the waiver of certain covenants under existing
borrowing facilities and continues to maintain constructive dialogue with its
core banking partners who have continued with their support throughout this
period.

The Board is, however, encouraged that the profitability of the business in
recent months has been in line with the Board's expectations. The positive
impact on the profitability of the Group of the implemented cost reduction
measures is now becoming increasingly evident in its financial performance. In
the first four months of the current financial year, the Group's fixed cost
base has been reduced by 9% year-on-year, with this saving expected to
increase as additional cost reduction actions take effect.

Following the seasonally loss-making months of February and March, the Group
generated unaudited EBITDA (pre-IFRS 16) of approximately £1.1 million for
April and May combined, an EBITDA margin of 14%, an improvement from 9% in the
prior year period.  For the first four months of the financial year, the
Group is at EBITDA breakeven.

The Board will continue to provide further updates as appropriate.

 

Enquiries

 

 Unbound Group plc                                                           c/o Alma PR

 Ian Watson, CEO

 Gavin Manson, CFO
 Singer Capital Markets (Financial Adviser, Nominated Adviser & Broker)        +44 (0)20 7496 3000

 Peter Steel / Tom Salvesen / Alaina Wong / James Fischer
 Interpath Advisory Ltd (Joint Financial Adviser)                              +44 (0)20 3989 2800

 Will Wright / Andrew Stone / Jack Brazier
 Alma PR Limited (Financial PR)                                              +44 (0)20 3405 0205

 Josh Royston / Sam Modlin / Hannah Campbell                                 unbound@almapr.co.uk (mailto:unbound@almapr.co.uk)

 

Important Information

This announcement (including any information incorporated by reference in this
announcement) contains statements about the Group that are or may be deemed to
be forward looking statements. Without limitation, any statements preceded by
or followed by or that includes the words "targets", "plans", "believes",
"expects", "aims", "intends", "will", "may", "anticipates", "estimates",
"projects" or words or terms of similar substance of the negative thereof, may
be forward looking statements.

 

These forward looking statements are not guarantees of future performance.
Such forward looking statements involve known and unknown risks and
uncertainties that could significantly affect expected results and are based
on certain key assumptions. Many factors could cause actual results to differ
materially from those projected or implied in any forward looking statement.
Due to such uncertainties and risks, readers should not rely on such forward
looking statements, which speak only as of the date of this announcement,
except as required by applicable law.

 

The distribution of this announcement in jurisdictions outside the United
Kingdom may be restricted by law and therefore persons into whose possession
this announcement comes should inform themselves about, and observe, such
restrictions. Any failure to comply with the restrictions may constitute a
violation of the securities laws of such jurisdictions.

 

Market Abuse Regulation

The information contained within this announcement would have, prior to its
release, constituted inside information as stipulated under Article 7 of the
Market Abuse Regulation (EU) No.596/2014 as incorporated into UK domestic law
by virtue of the European Union (Withdrawal) Act 2018 as amended by virtue of
the Market Abuse (Amendment) (EU Exit) Regulations 2019 ("UK MAR"). Upon the
publication of this announcement via a regulatory information service, this
inside information will be considered to be in the public domain. For the
purposes of UK MAR, the person responsible for arranging for the release of
this information on behalf of Unbound is Gavin Manson.

 

Other notices

Singer Capital Markets Advisory LLP ("Singer Capital Markets"), which is
authorised and regulated by the UK Financial Conduct Authority, is acting
exclusively for Unbound and for no one else and will not be responsible to
anyone other than Unbound for providing the protections afforded to its
clients or for providing advice in relation to the matters referred to in this
announcement. Neither Singer Capital Markets, nor any of its affiliates, owes
or accepts any duty, liability or responsibility whatsoever (whether direct or
indirect, whether in contract, in tort, under statute or otherwise) to any
person who is not a client of Singer Capital Markets in connection with this
announcement, any statement contained herein or otherwise.

 

Interpath Ltd (trading as Interpath Advisory) is authorised and regulated in
the United Kingdom by the Financial Conduct Authority ("FCA") and is acting
exclusively for the Group and for no one else in connection with the subject
matter of this announcement and will not be responsible to anyone other than
the Group for providing the protections afforded to its clients nor for
providing advice in relation to the subject matter of this announcement.

 

 

 

 

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