Placing and Open Offer [MSC]

by: Phil Curtis 02/12/2013

This announcement is an advertisement and is not an offer to sell or the solicitation of an offer to buy any securities. It is not a circular, a prospectus or prospectus equivalent document. Investors should not subscribe for or purchase any shares referred to in this announcement except solely on the basis of information contained in the circular to be published by Corac Group plc in connection with the proposed fundraising.

2 December 2013

CORAC GROUP PLC

Proposed Firm Placing and Open Offer to raise up to £13.1 million and Notice of General Meeting

 

Corac Group plc (AIM:CRA) is pleased to announce that it has conditionally raised funds of £11.0  million through a Firm Placing of 110,010,232  New Ordinary Shares with new and existing institutional investors, together with an Open Offer to raise up to £2.1 million, before fees and expenses,  in each case through the issue of New Ordinary Shares at an Issue Price of 10 pence per New Ordinary Share.

 

Placing and Open Offer Highlights

  • £11.0 million conditionally raised by the Group through a Firm Placing of 110,010,232 New Ordinary Shares
  •  Up to £2.1 million conditionally raised through a 1 for 15 Open Offer of up to 20,528,694 New Ordinary Shares
  •  Issue Price discount of 13.0 per cent *
  •  Board and senior management subscribing for 800,000 shares in the Firm Placing

 

Background to and reasons for the Placing and Open Offer

  • Funding for the next stage of Corac's development:

o  to accelerate the rate of commercial return at CET; and

o  provide organic investment to grow ACI and Hunt Graham

  • Further investment in CET gas compression technology;

o follows strong progress with testing to date and new and amended customer contracts

o funding existing and new customer design, build and development projects

o intensive testing and accelerated compliance of completed products

o  customers include BP and  Saudi Aramco

  •   Expected that this should lead to the first commercial sales from turbo compressors in 2014, and from gas compression technology in 2016

*to Closing Price on Latest Practicable Date

Phil Cartmell, Executive Chairman said:

" The funding we have announced today is expected to enable us to accelerate the commercialisation of CET's technology and thereby build the future value of the Group.  We have made marked progress with the technology and with customers especially in recent years and are poised to take the business to the next stage of its development.  I thank existing and new shareholders for their support."

A circular containing details of the Proposed Firm Placing and Open Offer, terms and conditions of the Open Offer, actions to be taken by Shareholders in respect of the Open Offer and a Notice containing details of the General Meeting of the Company (the "Circular"), was sent to Shareholders this morning and is available to view on the Company's website at www.corac.co.uk. The same definitions apply throughout this announcement as are applied in the Circular.