Venture Finance Exit
3 July 2007
General Capital Group (AiM:GENC), the asset and venture finance specialists, is pleased to announce the achievement of a further exceptional realised gain of approximately £0.4m as a result of the redemption of its entire debt exposure with Cashbox plc (“Cashbox”) (AiM:CBOX).
Betweeen 1 July and 18 December 2006, General Capital entered into various lease rental agreements with Cashbox; the result of which culminated in aggregate net capital balances of £1.35m being outstanding from Cashbox as of 29 June 2007 (“the Facility”).
In the announcements made by Cashbox on 31 March and 17 April 2007, Cashbox confirmed that it had resolved to and subsequently secured new senior debt facilities amounting to £8.75m from Bank of Scotland. In conjunction with this a successful placing of 21.8m new shares at 15p to raise £3.26m was announced on 11 May 2007. Further, on 29 June 2007 Cashbox announced that £1.75m of its BoS facilities had been drawn down for extinguishment and early release payments to General Capital.
Under the terms of a Compromise Agreement entered into between General Capital and Cashbox which was completed on 29 June 2007, General Capital agreed (inter alia) to release all security held in connection with the Facility and to forgo all entitlement to subscribe for shares under the warrant arrangements described more fully in Cashbox’s Admission Document.
Commenting on this result, Jonathan Hill, Executive Deputy Chairman of General Capital, noted: “Over recent months Cashbox has experienced certain well publicised issues which have hampered the development of the business. Notwithstanding these issues, the robustness of the business model has enabled it to raise new equity and obtain further long term debt facilities”.
He went on to add: “Cashbox’s success in refinancing its balance sheet vindicates our decision to have supported Cashbox prior to its admission to AIM in April 2006. Our ability to influence re-financing exercises of this nature firmly underscores the success and sustainability of our venture debt model – even in the more difficult credit markets which are currently being experienced. Taking into account the corporate finance fee of £0.244m we received on Cashbox’s admission to AIM in April 2006, the 19% return on debt whilst our advance has been outstanding and the profit on redemption described above, the overall Internal Rate of Return in respect of this transaction is calculated considerably in excess of 60%.
For Further Information:
| General Capital Group plc | |
| Jonathan Hill, executive Deputy Chairman | Tel: +44 (0) 1603 610 610 |
| jonathan.hill@generalcapital.co.uk | www.generalcapital.co.uk |
| Collins Stewart Europe Ltd | |
| Chris Wells / Mark Connelly / Adam Cowen | Tel: +44 (0) 20 7523 8000 |
| mconnelly@collins-stewart.com acowen@collins-stewart.com |
www.cstplc.com |
Media Enquiries:
| Abchurch Communications | |
| Franziska Boehnke / Hugo Jenkins | Tel: +44 (0) 20 7398 7700 |
| franziska.boehnke@abchurch-group.com | www.abchurch-group.com |