Northgate, Redde Agree On Terms Of Merger; Northgate Reports Lower Profit In H1
Northgate Plc (NTG.L) said the Boards of Northgate and Redde plc have reached an agreement on the terms of a recommended share-for-share merger. Under the terms, each Redde shareholder will be entitled to receive: 0.3669 new Northgate shares for each Redde share. Northgate shareholders will own approximately 54 percent and Redde shareholders will own approximately 46 percent of the share capital of the merged entity, to be called Redde Northgate plc.
Martin Ward, CEO of Redde, will become CEO of the combined Group. Philip Vincent, CFO of Northgate, will become CFO of the combined Group. Avril Palmer-Baunack, non-executive chairman of Northgate, will become non-executive chairman of Redde Northgate plc. The combined Group will look to pay interim dividends that are 50 percent of the prior final dividend.
Separately, Northgate plc (NTG.L) reported profit before tax of 24.8 million pounds for the six months ended 31 October 2019 compared to 28.7 million pounds, prior year. Earnings per share was 15.7 pence compared to 18.0 pence. Underlying profit before tax declined to 27.6 million pounds from 29.2 million pounds. Underlying earnings per share was 17.2 pence compared to 18.1 pence.
First-half total underlying Group revenue declined 4.3 percent to 357.8 million pounds. Group vehicle hire revenue grew 2.5 percent on a reported basis. Excluding the impact of foreign exchange, Group vehicle hire revenue grew 2.3 percent. Group vehicle sales revenue declined 19.7 percent, for the period.
Looking forward, the Board stated that the Group’s overall financial performance expected for the year ending 30 April 2020 is in line with its expectations. The Board has declared an interim dividend of 6.3 pence per share which will be paid on 24 January 2020 to Shareholders on the register on 13 December 2019.
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