Aim broker Alexander David Securities is reversing into Griffin Group.
The initial value of the acquisition is £3.88m, all of which is payable in shares. That is equivalent to 74.7% of the enlarged share capital of Griffin. The maximum consideration could be £4.85m. Alexander David has to make profits of more in than £1.5m in the two years to December 2009 to trigger any additional share payment.
Alexander David lost £300,000 on revenues of £574,000 in the six months to June 2008.
The original operations of Griffin, which involve floating shell companies on Aim and Plus-quoted, are being sold for £1.2m to Global Investments, a company where Stephen Dean, a director of Griffin Group, has an interest. An initial £250,000 has been paid and a further £650,000 will be paid when the deal is completed. The final £300,000 becomes payable 120 days after completion.
Griffin Group’s net asset value was £1.52m at the end of June 2008. That includes stakes where the companies’ share prices will have fallen since.
Alexander David reckons that its profile will be improved by floating on Aim. It has also been appointed as Griffin Group’s broker.
The acquisition is dependent on FSA approval among other things. The reversal is expected to happen on 25 November or five days after FSA approval if it is later.
The whole board will change following the deal.
Griffin shares rose 0.15p to 0.675p each – the bid/offer spread is 0.5p/0.85p. Griffin is currently valued at £740,000.
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