Sport Capital Group Plc - Acquisition; Capital-Raising Programme
PR Newswire
London, January 17
SPORT CAPITAL GROUP PLC
("SCG" or the "Company")
SCG acquires its first soccer club, Palermo Football Club S. P. A;
announces intention to raise additional investment capital
Acquisition of Sport Capital Group Holding Ltd, the holding company of Sports Capital Group Investments Ltd. and of Palermo Football Club S.p.A., which own US Città di Palermo S.p.A and Mepal Srl (IP and stadium project), for a nominal sum; intended investment capital raising programme
SCG is pleased to announce its acquisition of Sport Capital Group Holdings Limited ("SCGH"), the parent company of Sports Capital Group Investments Ltd. ("SCGI"), sole owner of Italian football club, U.S. Città di Palermo, in Palermo, Sicily, and of Mepal Srl ("Mepal"), the club's intellectual property and stadium project.
About Palermo Football Club S.p.A ("PFC" or "Palermo")
PFC is an Italian football club in Palermo, the capital of Sicily, presently playing in Serie B of the Italian Football League. Formed in 1900 as Anglo-Palermitan Athletic and Football Club, PFC is the top-ranked football club on the island of Sicily.
- Palermo currently stands at the top of Serie B (five points clear) and was the clear leader at the end of the first half of the season
- It counts 41 Players in the League Squad in addition to a youth academy, an under 18 team , five younger teams and one female team
- Through Mepal, PFC, owns the rights to build a new stadium
- Revenue: 2016/17 €79.4m in Serie A; 2017/18 €43.9m in Serie B
- Total Assets: 2016/17 €126.6m in Serie A; 2017/18 €91.6m in Serie B
- Under-managed business aspects such as minimal sponsorship, under-developed stadium and match day revenues leave significant scope for improvement of supporter experience and for value creation
- Significant revenue and value increase should occur if Palermo wins promotion to Serie A
About Sport Capital Group Holdings Ltd
SCGH is a private company incorporated in England and Wales for the purposes of purchasing the structure of companies which own PFC. It was established as a special purpose vehicle ("SPV") and does not presently conduct a trade or hold other assets.
The structure includes £15,000,000 (fifteen million Sterling) of indebtedness in the form of loan notes (the "Loan Notes") secured against 100% of the share capital of SCGI, a wholly-owned subsidiary of SCGH.
If Palermo achieves promotion to Serie A (the highest Italian league) in the current or following seasons, a conditional earn-out payment shall become payable by SCGI's subsidiary company, PFC, to the holders of the Loan Notes. Promotion should add significantly to PFC's value, an assumption based inter alia on the historic financial results when Palermo previously played in Serie A.
The Company announces that, to support an accelerated investment drive, it intends through a bond issuance programme of Euro- and Sterling-denominated fixed income securities to appoint Epsion Capital Limited ("Epsion") as Lead Arranger to raise up to £10,000,000 (ten million Sterling-worth) of additional investment capital. The bonds' duration will be five years with a coupon of 6% p.a. and they will be issued in tranches, based on investor demand, over the course of 2019. The Company intends to make an application for admission of the bonds issued under the financing programme to trading on the NEX Exchange Growth Market or another appropriate forum of quotation in the UK or Continental Europe. The Company will make further announcements on its financing programme as and when required.
Disclosures
This announcement includes inside information as defined in Article 7 of the Market Abuse Regulation No. 596/2014 ("MAR") and is disclosed in accordance with the Company's obligations under Article 17 of MAR.
John Treacy, a director of the Company and of Eight Capital Partners plc ("ECP"), the NEX Exchange-quoted investment vehicle which holds 22.78 per cent of SCG, is the sole shareholder of SCGH, although Mr. Treacy is receiving no benefit as a result of the sale of SCGH to the Company. Mr. Treacy is also the sole owner of Epsion, which company is intended to be paid a fee by the Company for placing the 2024 bonds described above.
Dominic White, a director of ECP, is also a director and significant shareholder of an SPV which holds the Loan Notes and consequently stands to benefit from the conditional earn-out arrangement described above, which may become payable by PFC to the creditor SPV. For these reasons each of Mr. Treacy and Mr. White is a related party in the acquisition by SCG of SCGH and, through it, of Palermo.
The acquisition of Sport Capital Group Holdings Limited by the Company is thus, and the proposed contract under which Epsion shall place the 2024 bonds on behalf of the Company will be, related party transactions.
Sport Capital Group plc,
Simon Grant-Rennick, Chairman
17th January 2019
This announcement has been made after due and careful enquiry. The Directors of Sport Capital Group plc accept responsibility for its content.
REGULATORY ANNOUNCEMENT ENDS
Enquiries
Sport Capital Group plc: Simon Grant-Rennick
E-mail: sgrelk@aol.com
Mob: +44 797 325 3124
Keith, Bayley, Rogers & Co. Limited (NEX Corporate Adviser and broker): Graham Atthill-Beck
E-mail: Graham.Atthill-Beck@kbrl.co.uk
Tel: +44 20 7464 4091
Mob: +44 750 643 4107; +971 50 856 9408
Brinsley Holman
E-mail: Brinsley.Holman@kbrl.co.uk
Tel: +44 20 7464 4098
Mob: +44 777 630 2228
Financial PR
Abigail Stuart-Menteth +44 (0)207 812 0645
abigail@damsonpr.com
Notes for Editors
About Sport Capital Group plc
Sport Capital Group invests in companies in the global sports and leisure sectors. In particular the focus is on football, associated real estate, stadium assets, merchandising and IP.
SCG's strategy is to invest in a portfolio of at least six football clubs, their IP and real estate, focusing on opportunities in Europe including the United Kingdom. The Company will bring professional on- and off-pitch football management, business and corporate finance capabilities to bear on under-managed clubs, of which there are many. The team will consist of professionals from football, business and the capital markets.
The Company's business model is to acquire lower league and non-league clubs, apply capital, business expertise, high-level football management and coaching, to create positive momentum and team psychology resulting in promotions to higher leagues. It will innovate and develop new revenue streams in its portfolio clubs. Promotion usually adds greatly to revenue streams and results in significantly higher asset values.
