Green Chemicals plc - Financing: related party transaction; share placing
03 Jul 2008
Financing
The Company has secured additional funding in the amount of £500,000 before expenses to finance its product development, regulatory approvals and commercialisation programme.
This falls into two elements: £250,000 of new equity capital and £250,000 of new, unsecured loan capital.
Share Placing
Hichens, Harrison & Co. plc, Financial Adviser to green chemicals plc, has placed 64,935 new ordinary shares of 5 pence ("Shares") at £3.85 each (being the PLUS mid-market closing price on 27 June 2008) on the Company's behalf with Martin Penny, to raise £250,000 before associated costs. Mr. Penny is the founder and Managing Director of Jemella Group, trading as ghd (Good Hair Days), with which group the Company announced on 3 December 2007 it had entered into a letter of intent.
Welcoming Mr. Penny to the shareholders' register, Chairman David Norwood, said, "We are delighted that Martin has decided to invest in green chemicals plc; we believe this, in part, reflects the progress we have made and continue to make in the development of innovative, "cleaner, greener and safer" permanent hair colorants. The potential professional and consumer market for such products is substantial, both domestically and internationally. We look forward to continuing to work with Martin's group and others to commercialise this technology."
Loan Capital
Richard Farleigh, a significant (12.69 per cent on 30 June 2008) shareholder of the Company, a co-founder and former director of green chemicals plc's predecessor company, Primavera Capital plc, shall advance £125,000 of loan capital on the same terms as IP2IPO Limited ("IP2IPO"), a subsidiary of IP Group plc ("IP Group"). IP2IPO shall provide a like amount of loan capital in addition to the loan to the Company announced on 19 February 2008.
Related Party Transaction
IP Group is the parent company of Techtran Limited and of the IP Venture Fund, which collectively control approximately 30.21per cent of the issued ordinary share capital of green chemicals plc as at 30 June 2008; the £125,000 loan from IP2IPO is therefore a related party transaction within the meaning of the PLUS Rules. The terms of the loan are confidential; the independent directors and the Company's advisers consider that the terms are fair and commercial having regard to the surrounding circumstances and that they do not disadvantage the Company relative to the probable cost of any alternative sources of loan capital presently available.
Stephen Winston, Chief Executive, observed, "The independent directors echo the Chairman's sentiments in relation to Martin Penny's investment in the Company and are also pleased that an equal amount of new loan capital has been made available simultaneously by two important and supportive shareholders, thereby further underlining their financial commitments to green chemicals plc's business plan."
The Company's ordinary share capital as enlarged by the allotment of the 64,935 new Shares as described above will be £401,338 or 8,026,752 Shares.
David
Norwood Clemmie
Carr
Graham Atthill-Beck
Stephen
Winston Simon Hudson
green chemicals plc Tavistock
Communications Hichens Harrison & Co. plc
Tel: +44 113 3432924 Tel: +44 20
7920 3150 Tel: +971 50 856 9408 or
+971 4 343 1330
