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The Board of PLUS Markets Group plc ("PLUS" or the "Group") announces that it has entered into an agreement with ICAP Holdings Limited ("ICAP"), whereby ICAP will acquire the entire issued share capital of the Group's wholly-owned subsidiary, PLUS Stock Exchange plc ("PLUS-SX"), the cash equities recognised investment exchange ("RIE") on a cash-free, debt-free basis for a nominal cash amount of GBP1 (the "Proposed Transaction").
PLUS-SX remains a loss making business. The disposal will, therefore, help both the Group preserve remaining shareholder value and protect the reputation and continuity of the RIE for its existing listed and quoted companies.
As the world's leading interdealer broker for the wholesale financial markets in both voice broking and electronic trading, ICAP is well positioned to leverage PLUS' exchange status to offer new products and solutions for its customers including, in time, listed derivatives. Moreover, ICAP has separately confirmed today that it is committed to continue supporting and expanding the PLUS equities listings venue which provides growth capital for smaller companies.
The Proposed Transaction is subject to shareholder approval and no insolvency proceedings having been commenced in relation to PLUS-SX.
The Proposed Transaction will constitute a change of control of the RIE under the Financial Services and Markets Act 2000 ("FSMA") and will require ICAP to obtain agreement from the Financial Services Authority prior to the completion of the Proposed Transaction. Furthermore, the Proposed Transaction will be classified as a disposal resulting in a fundamental change of business under the AIM Rules for Companies and will be subject to shareholder approval at a general meeting.
A circular setting out the details of the Proposed Transaction (the "Circular") will be prepared and posted to PLUS shareholders as soon as reasonably practicable, along with a notice of general meeting of shareholders. The Board will also continue to evaluate the options available to it in respect of either returning residual value, if any, to shareholders or converting the Group into an investing company under the AIM Rules. Following the proposed sale of PLUS-SX, the Group will hold two subsidiary companies, PLUS Derivatives Exchange Limited ("PLUS-DX") and PLUS Trading Solutions Limited ("PLUS-TS").
The Proposed Transaction is for a nominal amount due to the current liabilities that remain within PLUS-SX and the ongoing cost of maintaining the RIE. Information extracted from unaudited management accounts for the period to 30 June 2011 show losses of GBP1.025 million attributable to PLUS-SX. For the year ended 31 December 2010, the audited accounts show losses of GBP5.694 million attributable to PLUS-SX.
As set out in the Group's announcement of 14 May 2012, the Group will continue the process of orderly closure of PLUS-SX and in the event that the Proposed Transaction does not complete, for whatever reason, PLUS-SX will be wound down.
The Group continues to have discussions with a limited number of interested parties that may lead to the disposal of one, or both, of its other subsidiary companies, PLUS-TS and PLUS-DX. As indicated in previous announcements, the Board continues to explore possible asset disposals that would be in the best interests of shareholders in order to preserve and maximise any remaining shareholder value. There can be no certainty of any additional transaction being completed.
Commenting on the Proposed Transaction, Malcolm Basing, Interim Chairman and non-executive director of the Group, said: "The sale of PLUS-SX to ICAP, the world's leading interdealer broker, is the best option for our shareholders and secures the future of the PLUS-quoted market."
