St. Modwen Properties PLC (`the Company`), the regeneration specialist, has agreed, subject to the transaction going unconditional , to sell its 27.2% shareholding in Northern Racing PLC (” Northern “) to Aldersgate Investments Limited (‘Aldersgate’) (a company wholly-owned by David and Simon Reuben) for £17.7m.
The investment, which is held by the Company`s Employee Share Trust, was valued in the St Modwen group accounts at 30th November 2006 at £11m. The proceeds of the disposal will be held to satisfy current and future benefits of employees of the Company.
St Modwen and other principal shareholders in Northern who together own 86.2 % of Northern `s share capital have agreed to sell their holdings at a price of 185p per share. An offer is being made by Aldersgate for the remainder of Northern’s share capital at 200p per share.
The difference on price arises because an associate of Aldersgate had acquired an interest in Northern at a price of 200p requiring any offer to be made at that price or above. After detailed discussions Aldersgate felt it could not justify an enterprise value for Northern based on 200p.It was therefore agreed that the offer should proceed on the basis that the principal shareholders should receive 185p whilst securing the higher price for the remaining share holders.
Anthony Glossop, Chairman of the Company said, “This disposal marks the Company`s exit from the racing industry which began with the acquisition of Uttoxeter Racecourse in 1988.
“Our involvement has been both profitable and highly successful in regeneration terms with many of the courses playing a major role in their local leisure facilities and having lacked investment for many years before their acquisition.
“The racecourse involvement also started a trend, carried on with Trentham Gardens, Solihull Ice Rink and the Avonmouth landfill operation of the Company being willing to take on a limited operational role to help it secure an overall improved regeneration solution .
“I would like to thank all the employees of Northern for their support during the years of our involvement and to wish them every success in the future”
For further information please contact:
St. Modwen www.stmodwen.co.uk
Bill Oliver, Chief Executive
Tim Haywood, Finance Director 0121 222 9400
Gareth David 020 7457 2020