Normandy Limited to merge into  Caribbean Investment Holdings

TORTOLA: Caribbean Investment Holdings (CIHL) announced that agreement has been reached on the terms of the proposed acquisition of the entire issued share capital of Normandy Limited by the Company.

The acquisition will be implemented pursuant to the terms of the merger, which is anticipated to become effective on or around 9 June 2020.

Following completion of the merger, Normandy Shareholders will collectively hold up to 35.774 million New CIHL Shares equivalent to approximately 36.1 percent of the existing issued share capital of CIHL and approximately 26.6 percent of the Enlarged CIHL Share Capital. The balance of 98.967 million CIHL Shares, equivalent to approximately 73.4 percent of the Enlarged CIHL Share Capital, will be held collectively by the Existing CIHL Shareholders.

Lord Ashcroft, KCMG PC holds approximately 82.78 percent of the current issued share capital of Normandy and approximately 78.33 percent of the current issued share capital of CIHL and will hold approximately 79.5 percent of the Enlarged CIHL Share Capital following completion of the merger.

By way of consideration for the merger, Normandy Shareholders will be allotted and issued 2 New CIHL Shares for every 11 Normandy Shares registered in their name.

Based on the average middle market middle market closing price of CIHL on 4 June 2020, being 38 pence, the merger values each Normandy Share at 6.9 pence and the existing issued share capital of Normandy at approximately £13.58 million in aggregate.  At June 4, 2020 (being the last Business Day prior to the announcement of the potential transaction), the value of Normandy’s cash deposits amounted to approximately £13.5 million, representing Normandy’s sole asset.

Normandy Shareholders have the right to dissent to the Merger. The dissenting Normandy Shareholders may within one month of receipt of the written resolutions for signing apply to the Bermuda Court to appraise the fair value of their shares.  However, the only remedy for the dissenting shareholders is to be paid the fair value for their Normandy Shares.

Normandy is a strategic investment company admitted to trading on the BSX.  For the twelve months ended 31 March 2019 Normandy reported net profit of £700 and earnings per share of £nil. At 31 March 2019, Normandy’s sole asset comprised interest bearing cash deposits with banks amounting to approximately £13.5 million. Since that date, Normandy has continued to hold the cash deposits earning interest at market rates.

The board of CIHL believes that in the current uncertain economic climate, the acquisition of Normandy (and its main asset of approximately £13.5 million in cash) will strengthen the Company’s balance sheet, and will enhance the Company’s ability to execute its strategy of exploring further synergistic acquisition opportunities in the Caribbean region.

The Directors intend to make this cash available to the Company to fund such expansion opportunities. The board of CIHL also believes that the current climate will create opportunities for the Company to explore, and that having readily available cash resources will mean that the Company is better positioned to take advantage of situations as they arise.

The Company has been exploring potential acquisition opportunities, although as at the date of this announcement no agreement has been reached in relation to any such opportunities.

Lord Ashcroft, KCMG PC, the majority shareholder in Normandy, has already voted to approve the Merger and has irrevocably undertaken to vote in favour of the Merger in respect of his aggregate holding of 162,880,568 Normandy Shares representing approximately 82.78 per cent. of the shares eligible to vote.  Consequently, the approval of the Normandy Resolution by the requisite majority has already been determined.

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