NMCN is set to be fully re-capitalised through an equity raise of £24m to £29m and a new banking facility of £7.5m-£8.5m.
Under the agreed arrangement, NMCN will get an immediate £10.0m capital injection by way of a convertible bridging loan from Svella Plc, that will convert into new ordinary shares on completion of the overall transaction. A further equity fund raising of up to £19m will consist of £14m from new investors, including Svella, which will consequently have a controlling stake in the company, and up to £5m via an open offer to existing shareholders. NMCN has received irrevocable undertakings from a majority of shareholders to approve the transaction at a general meeting.
Although it sounds Scandinavian, NMCN’s new majority owner is actually based in Carlisle, set up in 2018 by former Stobart executives Andrew Tinkler and Ben Whawell to invest in under-performing companies.
NMCN’s current executive team led by recently arrived chief executive Lee Marks and finance director Alan Foster will remain in place under the new owners but a new independent non-executive director will be appointed.
Lee Marks said: “I joined NMCN in early May 2021 because I believed it was a company that was well positioned in its key markets and had the potential to successfully and profitably address the opportunities within them. I remain of that view and today’s news enables us to now look forward.
“We have much to do and we need to learn from our past mistakes. However, with the appropriate financial foundations and support of our new investors in place, I look forward to leading the business into a new chapter.”
Svella chairman Andrew Tinkler said: “Our investment in NMCN will provide much needed recapitalisation of the business to position it for future growth and power its Covid recovery. With a strong customer base, solid foundations and industry heritage, NMCN is a well-established business with a reputation underpinned by skilled and enthusiastic employees. There is a positive culture and work-ethic running throughout the business built upon the ethos of creating a positive impact across its core operations, ESG and wider community activities. As such, there are strong synergies with other businesses and sectors we have successfully invested in to deliver management focused strategic improvements and significant shareholder value.”
The new banking facility will be provided by the company’s existing bank, Lloyds, consisting of a £5m-£6m committed revolving credit facility and a £2.5m term loan.
Got a story? Email news@theconstructionindex.co.uk
.gif)
