On 3 October 2018, Ardent Leisure Group’s (ASX: AAD) made an announcement regarding a proposal for the corporatisation of the Ardent Leisure Group which will involve a formation of the new company called Ardent Leisure Group Limited to replace the current stapled structure and become a single head entity. Following this news, the share price of the company increased by 0.287 percent as on 3 October 2018.
The Directors of Ardent Leisure Group evaluated the benefits of the current stapled structure and came to the conclusion that the complexity of the current stapled structure of Ardent Leisure Group is not appropriate anymore and that the corporatisation and associated streamlining of the Group structure is in the best interest for the securityholders.
According to the proposal, there will be no change to eligible securityholder’s ownership levels and instead of their shares in current stapled securities in Ardent Leisure Limited and the Ardent Leisure Trust, they will hold shares of Ardent Leisure Group Limited. No capital raising or return of capital will be required for the implementation of the proposal and eligible securityholders will not be required to pay any cash consideration. To align the group’s structure to its two business divisions i.e., US Entertainment Centres and Australian Theme Parks, the group is also planning to undertake a solvent restructure.
The company has confirmed that there will not be any change in the economic interest of the eligible shareholders as neither the Proposal nor the Restructure will change the composition of the boards of directors or the operations, assets or liabilities of the group. The implementation of the project is subjected to the satisfaction of various conditions which includes receipt of certain relief from ASIC and ASX, approval of the shareholders, Supreme Court of New South Wales approval and consent of Ardent Leisure Group’s lending syndicate. The company has already applied in the court for approval to begin the necessary meetings of securityholders for considering and vote on the Proposal. The company is expecting that the Proposal will be implemented by the end of the calendar year 2018 and the restructure will be done soon thereafter.
AAD’s share traded at $1.745 with a market capitalization of $834.69 million as on 3 October 2018 (AEST 3:17 PM).
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