Better Capital PCC has announced that BECAP12 Fund LP, via its subsidiary, C Bidco Limited, has entered into a conditional agreement with Gardner Aerospace Holdings Limited (Gardner), a wholly owned subsidiary of Shaanxi Ligeance Mineral Resources Co. Limited (SLMR), for the sale of the entire issued share capital of Northern Aerospace Limited (NAL) for cash consideration, which values the business at £44m on an enterprise value basis.
Potential break fee if transaction fails to complete
Better Capital says that the deal remains subject to the satisfaction of certain conditions and approvals being obtained. This is expected to occur during a 40-day period from the date of entry into the next phase of the agreement, which is expected to be imminent. Should Gardner fail to complete the transaction at the end of that period, then, absent a material adverse change, a £3m break fee becomes payable to the NAL shareholders.
Shaanxi Ligeance Mineral Resources Co
SLMR is headquartered in China and listed on the Shenzhen Stock Exchange. BCAP says that SLMR is the ultimate parent company of a group whose current main activity is mineral exploration and production, but whose interests include a growing aerospace machining and component manufacture division. SMLR acquired Gardner from BECAP Fund LP in June 2017.
Transactions proceeds expected to be circa £6om
BCAP says that, in the event that the proposed transaction does proceed on the terms contemplated, the expected net proceeds receivable by the Fund (from this transaction in addition to the proceeds of the warranty claim relating to NAL’s predecessor company) are materially in line with the carrying value of £60m, as reported in the 2017 Interim Results.
2012 Cell is expected to show an NAV decline of 3%
BCAP says that it expects that the annual results for the year ended 31 March 2018 to be released early in July 2018. It also says that it anticipates that the NAV of the 2012 Cell will show a decline in the region of 3%.
Better Capital sells Northern Aerospace to SLMR : BC12, BCAP