Deepverge PLC Disposal;Update; Related Party Trans'n-replacement (5399I)

TIDMDVRG

RNS Number : 5399I

Deepverge PLC

07 August 2023

The following correction has been made to the "Disposal; Update" announcement released on 7 August 2023 at 0700 under RNS No 4310I.

The headline has been corrected to refer to the treatment of the Disposal as a related party transaction; and an additional section headed "Related Party Transaction", dealing with the requirements of AIM Rule 13, has been added to the body of the announcement.

All other details remain unchanged.

The full amended text is shown below.

DeepVerge plc

("DeepVerge" or "the Company" or "the Group")

Disposal; Update; Related Party Transaction

The Company announces the sale of Glanaco Limited, the engineering services company based in Cork, Ireland, to Tony Ryan and Michael Fitzgerald, the current management and previous owners, for consideration of EUR1 ("the Disposal").

The Company announced on 26 June 2023 that the Board had taken the decision to no longer support the ongoing costs of the operating businesses, and was seeking to realise whatever value is possible through the sale of one or more of the Labskin, Modern Water and Glanaco business units.

Since the acquisition of Glanaco in March 2022 it has incurred costs and liabilities related to other parts of the Group and has been left with insufficient cash to continue to operate as a going concern. By transferring the business back to management the business and associated jobs will be saved, and the Group's net creditors will reduce by approximately EUR0.5m. Glanaco will continue to provide services to Labskin and Modern Water on an arms' length basis for a transitionary period as necessary to support the ongoing efforts to realise value through the sale of any of part or all of these businesses.

Glanaco financial information

In its most recent published accounts, for the year ended 31 December 2021, Glanaco reported a profit before tax of EUR39,449 on turnover of EUR1,549,279. Its net assets at 31 December 2021 amounted to EUR415,309.

For the year ended 31 December 2022, for which accounts have not been audited, Glanaco made an (unaudited) loss before tax of EUR75,451 on (unaudited) turnover of EUR1,743,830. Its (unaudited) net liabilities at 31 December 2022 amounted to EUR42,514.

Related Party Transaction

The purchasers of Glanaco Limited, Tony Ryan and Michael Fitzgerald, are currently directors of Glanaco Limited. As such they fall to be treated as related parties under the AIM Rules for Companies ("AIM Rules"), and the Disposal has been treated as a related party transaction under AIM Rule 13 of the AIM Rules.

The directors of DeepVerge consider, having consulted with SPARK Advisory Partners Limited, its nominated adviser, that the terms of the Disposal are fair and reasonable insofar as its shareholders are concerned.

Update

The Board's expectation remains that the current process will result in the sale, closure or administration of all Group subsidiaries.

Further updates will be given as appropriate.

 
                            Nigel Burton, Interim 
 DeepVerge plc               CEO                     +44 (0) 7785 234447 
 SPARK Advisory Partners 
  Limited                                            +44 (0) 113 370 
  (Nominated Adviser)       Neil Baldwin              8974 
                           -----------------------  -------------------- 
 Turner Pope Investments    Andy Thacker/James       +44 (0) 20 3657 
  (TPI) Limited (Broker)     Pope                     0050 
                           -----------------------  --------------------

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END

DISSSAFDWEDSEEA

(END) Dow Jones Newswires

August 07, 2023 09:30 ET (13:30 GMT)

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