Announcement • Sep 20
Hostmore plc Provides Business Update Further to its announcement on 9 September 2024, Hostmore plc (LSE:MORE) (the "Company" and, together with its subsidiaries, the "Group"), is providing an update to the market. Sale Process Update: The sale process for the Group's corporate stores remains ongoing, with completion continued to be expected by the end of September. The Group's trading subsidiary, Thursdays (UK) Limited ("Thursdays"), continues to operate normally and all existing stores remain open. Appointment of Administrators and Listing Suspension: As announced previously, the store sale consideration is expected to be below the par value of the secured borrowings of Thursdays, and therefore it remains unlikely that the equity owner of Thursdays, being the Company (Hostmore plc), will recover any value for its ownership. The Group previously disclosed that the Company (Hostmore plc), being the listed non-trading holding company of Thursdays, would be delisted and wound up. The Board of the Company has now resolved to file for administration of the Company and, consequently, the listing of the Company's ordinary shares has been suspended. The Board has resolved to appoint Daniel Smith and Julian Heathcote of Teneo Financial Advisory Limited as joint administrators of the Company. The filing of administration by the Company will have no direct impact on the operations of the trading subsidiary, Thursdays. The Board continues to expect that, in due course, the listing of the Company's ordinary shares will be cancelled and the Company will be wound up. The Board believes these actions are in the best interests of creditors and other stakeholders of the Company. Announcement • Sep 11
Hostmore plc Provides Sale Process Update Hostmore plc (LSE:MORE) provided sale process update. The sale process for the Group's corporate stores announced on 6 August 2024 has now reached an advanced stage. A full process was undertaken with outreach conducted to a long list of potential acquiring parties. Several formal bids were received and over recent weeks discussions have been held with the leading bidders to assess and improve their bids. The present indications from the leading bids are that the consideration for the store sale will be lower than the par value of the borrowings currently secured by the Group's trading subsidiary, Thursdays (UK) Limited ("Thursdays"). Accordingly, it is unlikely that the equity owner of Thursdays, being the Company, will recover any meaningful value for its ownership. The sale process is expected to complete in late September; however, Thursdays continues to operate normally and all existing stores remain open. It is the Board's present expectation that the Company (Hostmore plc), being the listed non-trading holding company of Thursdays, will be wound up and delisted contemporaneous with the conclusion of the sale process, as TGI Fridays in the UK will continue its operations under new ownership. Acquisition of TGI Fridays Inc.: The Board has continued to work to reach binding terms regarding the proposed all-share acquisition (the "Acquisition") of TGI Fridays Inc. ("TGI Fridays"). However, the Board has now confirmed with TGI Fridays that the trustee of TGI Fridays' corporate securitisation terminated TGI Fridays as the manager (the "Termination") of TGIF Funding LLC ("TGIF Funding"), which is the company subject to the corporate securitisation. TGIF Funding holds legal title to the franchise agreement royalties and other various fees and revenue from intellectual property of the TGI Fridays business. While TGI Fridays remains the owner of the residual interest in TGI Funding, the Termination compromises the control over the royalty stream of TGI Fridays and also potentially impairs the future revenue of the business. The predictable and highly cash generative royalty stream of TGI Fridays was the primary attractive feature for the Group in pursuing the Acquisition. Following the Termination, the Acquisition is no longer being actively pursued. However, TGI Fridays and the Group agree that each is open to re-engaging discussions if circumstances warrant. New Risk • Sep 09
New major risk - Market cap size The company's market capitalization is less than US$10m. Market cap: UK£1.10m (US$1.43m) This is considered a major risk. Companies with a small market capitalization are most likely businesses that have not yet released a product to market or are simply a very small company without a wide reach. Either way, risk is elevated with these companies because there is a chance the product may not come to fruition or the company's addressable market or demand may not be as large as expected. In addition, if the company's size is the main factor, it is less likely to have many investors and analysts following it and scrutinizing its performance and outlook. Currently, the following risks have been identified for the company: Major Risks Share price has been highly volatile over the past 3 months (27% average weekly change). Earnings have declined by 52% per year over the past 5 years. Market cap is less than US$10m (UK£1.10m market cap, or US$1.43m). Minor Risk Negative equity (-UK£4.7m). 