20/09/2010
Dignity plc - Pricing of Secured Notes and intention to return £1 per share to shareholders
Dignity plc announced in its interim results on 30 July 2010 that it was investigating the potential to issue further Secured Notes. On 13 September 2010, Dignity Finance PLC (the issuer of the Secured Notes and a subsidiary of Dignity (2002) Limited, the holding company of the securitised sub-group of Dignity plc) issued a preliminary prospectus. Dignity plc also announced on 17 September 2010 that Dignity Finance PLC had duly held a meeting of Class A Noteholders on 17 September 2010. The principal purpose of the meeting was for Dignity Finance PLC to obtain certain consents and waivers by means of an Extraordinary Resolution from the Class A Noteholders in order to facilitate a further issue of Secured Notes. Dignity plc announced on 17 September that the Extraordinary Resolution had been passed.
The Dignity Group is pleased to announce that pricing for the new Secured Notes has now been determined. Class A Notes with an outstanding nominal amount of up to £38.9million are intended to be issued at a cash price of approximately 116.25% and Class B Notes with an outstanding nominal amount of up to £33.1million are intended to be issued at a cash price of approximately 126.63%.
Consequently gross proceeds from the new Secured Notes are expected to be £87.1 million. After retaining funds for fees, accrued interest on the further Secured Notes, a payment of £1 million into the Group’s defined benefit pension scheme and withholding some funds for general corporate purposes (including acquisitions), it is the Dignity Group’s intention to return £63.9 million, equating to £1 per ordinary share, to its shareholders. As a result of this intended return, Dignity plc expects to cancel the interim dividend of 4.43 pence per Ordinary Share that was declared on 30 July 2010.
The Dignity Group anticipates that the issuer will execute the subscription agreement with the Lead Manager, the Royal Bank of Scotland plc on or around 22 September. Closing and settlement of the new Secured Notes is anticipated to occur on 27 September. Until such time, there can be no guarantee that the further Secured Notes will be issued and consequently no guarantee a return of cash will be made to shareholders.
Based on this timetable, the Group expects to issue a notice of a general meeting and an accompanying shareholder circular on or around 22 September. It is anticipated that at the general meeting, resolutions will be proposed which, if passed, will give shareholders the ability to receive the £1 per share either in the form of a dividend or as a return of capital. The meeting will also be asked to approve a consolidation of the Group’s ordinary shares, which is intended to maintain comparability of the Group’s performance measures such as earnings per share and share price.
The Group will make further announcements as appropriate.
For more information
Mike McCollum, Chief Executive
Steve Whittern, Finance Director
Dignity plc +44 (0) 121 354 1557
Richard Oldworth
Suzanne Brocks
Christian Goodbody
Buchanan Communications +44 (0) 20 7466 5000