TIDMPAR
RNS Number : 7446R
Paragon Resources PLC
30 October 2013
30 October 2013
Paragon Resources PLC
("Paragon" or the "Company")
(AIM: PAR)
Investment in Greenstar Resources,
Appointment of Chief Executive Officer,
Issue of Equity, Total Voting Rights and The Takeover Code
Investment in Greenstar
Paragon, the AIM-listed agricultural investing company (AIM:
PAR), is pleased to announce that, further to the announcement on
12 August 2013, it has today signed the sale and purchase agreement
to acquire a 40% shareholding in Greenstar Resources Limited
("Greenstar") as a first step in building a significant interest
and capability in African agricultural businesses (the
"Acquisition").
The consideration for the Acquisition will be GBP103,377 (based
on the closing mid-market price of Paragon's ordinary shares of
0.005p each ("Ordinary Shares") on 25 October 2013) and will be
satisfied through the issue of 41,688,426 new Ordinary Shares and
the payment of GBP20,000 in cash to Greenstar Associates LLP, the
current owner of Greenstar.
Greenstar brings a wide reputation and long track record to
Paragon of agricultural consultancy, operational and project
management and inward investment advisory services to large-scale
commercial agricultural projects in Africa. As has already been
evidenced to the Board of Directors of Paragon (the "Board"), it
also importantly brings access to significant deal flow.
Over the last two months, Greenstar has introduced to Paragon
four separate opportunities which it is currently actively working
on in pursuit of its investing strategy. These include projects
focused on palm, cocoa, rubber, rice and other more rapid cash
producing crops. The Board is hopeful of being able to move forward
with at least one of these opportunities as a long term, strategic
opportunity in the foreseeable future.
Greenstar is owned by Greenstar Associates LLP, the members of
which are Andrew Beveridge, members of his family and Simon Hunt.
The acquisition of Greenstar constitutes a related party
transaction under the AIM Rules, as both Mr Hunt and Mr Beveridge
are directors of Paragon. The Board (other than Mr Hunt and Mr
Beveridge, who are not considered independent) consider, having
consulted with Allenby Capital Limited, the Company's nominated
adviser, that the terms of the acquisition of a 40% interest in
Greenstar are fair and reasonable insofar as Shareholders are
concerned.
It is the intention of the Board to seek to increase the
Company's shareholding in Greenstar in the future, if appropriate,
and further announcements will be made accordingly. Any decision to
increase the Company's shareholding will exclude Mr Hunt and Mr
Beveridge.
Greenstar Associates LLP has entered into a "lock In" agreement
with the Company under which it has agreed not to sell any of its
41,688,426 Ordinary Shares for at least 12 months, and with orderly
market restrictions for a further 24 months.
Appointment of Chief Executive Officer
As part of the Acquisition, we are pleased to announce that
Andrew Beveridge has been appointed Chief Executive Officer of
Paragon, to bring his significant background and track record in
the African agricultural sector to the Company.
As previously announced, Andrew brings over 30 years' experience
in agribusiness in Africa, South East Asia and the Pacific region,
and particularly in the sectors where Paragon has chosen to focus,
with a career embracing both the management and investment aspects
of international agriculture. He followed studies in agricultural
science and management at the Royal Agricultural College with an
MBA at Warwick University and joined leading international
agribusiness group Harrisons and Crosfield. He later joined CDC
Group PLC (formerly the Commonwealth Development Corporation) and
was involved with new investment and agribusiness management in
Africa and the Far East ranging from start-ups to privatisations
and turnarounds of underperforming companies.
Andrew's most recent role has been in running the large African
oil palm plantation and processing company he started and where he
was its first CEO and is now a shareholder and an advisor.
Simon Hunt, Executive Chairman of Paragon, said "I am delighted
that Andrew Beveridge has agreed to become CEO of Paragon thereby
giving the Company top class, African agricultural management
expertise. I am confident that the projects we are currently
looking at with Andrew and Greenstar could form the basis of a
significantly valuable operation. To achieve success in this
sector, it is crucial to have close relationships with both
agricultural operators and experts. This acquisition brings both
and will allow Paragon to move forward quickly."
Andrew Beveridge, Chief Executive Officer, said "I am pleased to
take on this role and am certain that my long background and
connections in African agriculture will help us take Paragon
forward rapidly to implement the stated policy. These are exciting
times for emerging market agribusiness and I look forward to seeing
Paragon develop into a prominent player in the sector."
Issue of Equity
In addition to the 41,688,426 new Ordinary shares being issued
as part of the Acquisition, the Company has also issued 4,761,905
Ordinary Shares at 0.21p per share (being the average closing
mid-market price for the ten trading days up to and including 25
October 2013) in settlement of certain professional fees .
Application will be made to the London Stock Exchange for these
46,450,331 new Ordinary Shares to be admitted to trading on AIM and
it is expected that the admission will become effective and trading
in these shares will commence on 4 November 2013 ("Admission").
Total Voting Rights
Following Admission, the Company's enlarged issued share capital
will comprise of 425,675,097 Ordinary Shares. This figure of
425,675,097 Ordinary Shares may be used by shareholders in the
Company as the denominator for the calculations by which they will
determine if they are required to notify their interest in, or a
change in their interest in, the share capital of the Company under
the Disclosure and Transparency Rules of the Financial Conduct
Authority.
Director Shareholdings
Following the issue of the 46,450,331 new Ordinary Shares, the
Directors of the Company will have the following interests in
Ordinary Shares:
% of enlarged
share capital
Director No. of Ordinary Shares on Admission
Andrew Beveridge* 41,688,426 9.79%
Simon Hunt* 41,688,426 9.79%
Daniel Cassiano-Silva 18,754 0.00%
* Mr Beveridge and Mr Hunt are both members of Greenstar
Associates LLP which holds 41,688,426 Ordinary Shares.
Application of the City Code on Takeovers and Mergers
Following changes to the City Code on Takeovers and Mergers in
the United Kingdom (the "Takeover Code") that came into effect on
30 September 2013, Paragon is now a company that is subject to the
Takeover Code.
ENDS
For further information, please contact:
Paragon Resources PLC Allenby Capital Limited
Simon Hunt (Nominated Adviser and Broker)
(Chairman) Nick Harriss/Jeremy Porter/James
+44 (0)7733 337 755 Reeve
www.paragon-resources.com +44 (0)20 3328 5656
www.allenbycapital.com
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This information is provided by RNS
The company news service from the London Stock Exchange
END
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