TIDMRIIG
RNS Number : 8729T
Resources In Insurance Group PLC
14 December 2011
14 December 2011
RESOURCES IN INSURANCE GROUP PLC
(the "Company")
Successful placings and new contract win
Resources in Insurance Group plc (AIM: RIIG), a leading provider
of claims management and consultancy solutions to the United
Kingdom (the "UK") insurance profession, reports to the market
today on two successful private placings (the "Placings"), a
significant new contract win with another top 10 insurer and a
positive outlook for the year to 31 December 2012 ("FYE2012").
The Placings
The Company announces Placings totaling GBP130,000 from:
-- Hawk Investment Holdings Limited ("Hawk"), a Guernsey based
investment holding company
owned by serial investor Bob Morton;
-- John French, Executive Chairman of the Company; and
-- Spread Trustee Company Limited, on behalf of The French
Settlement.
Under the terms of the Placings, Hawk has subscribed GBP100,000
for 25,000,000 new ordinary shares of 0.1p each in the capital in
the Company ("Shares") at a price of 0.4p per share, increasing its
holding to 73,000,000 Shares, representing approximately 20.9 per
cent. of the issued share capital of the Company ("Issued Share
Capital"). Spread Trustee Company Limited, on behalf of The French
Settlement, has subscribed GBP30,000 for 7,500,000 Shares at 0.4p
per share, increasing its holding to 11,648,308 Shares representing
approximately 3.33 per cent of the Issued Shares. Following the
Placings, John French will be interested in 15,253,078 Shares,
representing approximately 4.36 per cent. of the Issued Share
Capital. This is split between 11,648,308 Shares held by Spread
Trustee Company Limited, on behalf of The French Settlement and
3,604,770 Shares held by John French.
Furthermore, the board of directors of the Company (the "Board")
announces the purchase of an unsecured convertible loan note of
GBP30,000 due 21 November 2015 (the "Loan Note") by John French and
Spread Trustee Company Limited, on behalf of The French Settlement,
taking their total investment under the Placings and the Loan Note
to GBP60,000. The Loan Note has a conversion price of 0.55 pence
per Share.
Proceeds from today's Placings and the Loan Note will be used as
working capital to support the Company's recent new contract
wins.
New business
Further to a major contract with a leading property and travel
insurer for its Verify product announced in September 2011, the
Company is pleased to announce it has signed a further two-year
agreement with an existing client, a top 10 UK insurer (the
"Agreement").
Under the terms of the Agreement, the Company has been engaged
to provide technical claims support to this leading industry client
across its motor and household insurance divisions. The Company
will implement an innovative framework agreement that will see
implant teams being insourced into the client's operations at times
of significant weather events or high claims volumes. The Agreement
will provide a flexible resourcing model going forward for business
as usual claims.
Strong outlook
The Company has seen steady recovery over the three-year period
since the Board realignment and during arguably challenging
macro-economic times, witnessing a turnaround from losses of
approximately GBP1.3 million for the year ended 31 December 2008 to
an unaudited half-year profit for the six months to 30 June 2011 of
GBP25,000.
The Company has achieved this through new business gains and
product development and from a debt-free position. Prospects for
the year to 31 December 2011 indicate the Company will maintain a
positive cash position, with the impact of new business gains
providing a basis for a beneficial start to FYE2012.
The Company enters FYE2012 with a strong prospective business
pipeline and the ability to offer a complete end-to-end package to
insurers. The Board remains firm in its view that the sector will
look at innovative and proven providers such as the Company to
deliver cost containment and improved services in volatile market
conditions.
Given the fact that Hawk is a substantial shareholder and John
French is a director of the Company, the Placings and issue of the
Loan Note are considered to be related party transactions pursuant
to Rule 13 of the AIM Rules for Companies. The Company's directors,
having consulted with the Company's nominated adviser, Allenby
Capital Limited, consider that the terms of the Placings and of the
Loan Note are fair and reasonable insofar as the Company's
shareholders are concerned.
Commenting, John French said:
"I am encouraged by the steady improvement in the performance of
Resources in Insurance Group and in particular the prospects for
the future, based on the interest we are receiving for services
from the insurance sector. The support we have received from
shareholders has been greatly appreciated and is reflective of the
fast turnaround of the Company in the last 24 months. I am pleased
that at a time of uncertainty with the euro and the European Union
in general, the Company has the benefit of dealing in sterling with
a client-base comprising leading UK based insurers.
"Furthermore, we are delighted to have secured additional work
that cements an already excellent relationship one of our top 10 UK
insurance clients. It is an innovative approach that ensures the
already excellent levels of customer service our client delivers to
their customers is further protected at time of "surge". There are
answers to both the surge issue and the need for flexible operating
models in the claims arena. A number of clients are actively
engaged with Resources in Insurance Group around this provision
within both insurers and service providers and we anticipate some
further announcements shortly. For the Company it is a significant
step forward in the strategic positioning of our insource claims
handling products."
Following the Placings, the Issued Share Capital consists of
349,995,709 Shares. The Company does not hold any Shares in
treasury. Therefore the total number of Shares in the Company with
voting rights is 349,995,709. This figure may be used by
Shareholders as the denominator for the calculations by which they
will determine if they are required to notify their interest in, or
a change to their interest in, the Issued Share Capital under the
Financial Services Authority's Disclosure Rules and Transparency
Rules.
ENQUIRIES:
Resources in Insurance Group Tel: +44 7836
plc 722482
John French
Allenby Capital Limited Tel: +44 20 3328
5656
Nominated Adviser and Joint
Broker
Brian Stockbridge/Alex Price/Dan
Robinson
Rivington Street Corporate Tel: +44 20 7562
Finance 3384
Joint Broker
Dru Edmonstone
For further information on the Company, please visit
www.riig.co.uk
This information is provided by RNS
The company news service from the London Stock Exchange
END
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