Fergus McCann Share Sale
See Also: Celtic Finances
CELTIC PLC 20 September 1999
PLACING AND OFFER FOR SALE BY WILLIAMS DE BROE PLC ON BEHALF OF FERGUS McCANN
Celtic plc (“Celtic” or “the Company”) announces a Placing and Offer for Sale by Williams de Broe on behalf of Fergus McCann of 14,400,000 of his Ordinary Shares. The Offer for Sale fulfils Fergus McCann‘s commitment to offer, on his departure after five years in control of Celtic, a majority of his Ordinary Shares to Qualifying Shareholders, Season Ticket Holders and Players and Staff (see Definitions).
Under the Placing 4,402,272 Ordinary Shares are being firm placed with institutional and other investors and under the Offer for Sale 9,997,728 Offered Shares are being conditionally placed with institutional and other investors, subject to takeup by Qualifying Shareholders, Season Ticket Holders and Qualifying Players and Staff and Other Applicants at 280p per share.
Under the Offer for Sale, priority will be given in the first instance to Qualifying Shareholders, and after that to Season Ticket Holders who are resident in the UK and the Republic of Ireland. In the event that there are Offered Shares which are not taken up by Qualifying Shareholders and Season Ticket Holders these will be available for application by Qualifying Players and Staff and then Other Applicants.
Depending on the levels of take up by Qualifying Shareholders and Season Ticket Holders, Fergus McCann will make a cash donation to Celtic to assist in the funding of a training academy.
Fergus McCann will dispose of his entire holding of Ordinary Shares in the Company, save that he will retain 200,000 Ordinary Shares which are the subject of options granted by him to certain employees of the Company.
The Offer for Sale has been fully underwritten by Williams de Broe other than as regards certain Offered Shares in respect of which irrevocable undertakings to take up have been obtained.
Background to the Offer and Placing
In the five financial years since Fergus McCann took control with his fellow investors, the Company has enjoyed strong growth. During this period turnover has risen over 385 per cent to £33.8 million, and profit from operations has increased from £282,000 to in excess of £6.7 million. At the same time over £18.1 million (net of proceeds from the sale of other players) was spent on the purchase of players and in excess of £41 million on the redevelopment of Celtic Park which is now the largest capacity club stadium in the United Kingdom with a capacity of 60,506.
Average league attendances in the 1998/99 Season were 59,224 with Season Ticket sales of 53,388 (which is the largest for a United Kingdom football club). Success on the playing field has also been achieved, albeit to a lesser extent than is desired by the Board. All the major Scottish trophies have been won over the last five Seasons – the Scottish Cup in the 1994/95 Season, and the League Cup and the Scottish Premier League Championship the 1997/98 Season. Significant progress in European Competitions has, however, been elusive during the last five Seasons.
In April of this year, Fergus McCann resigned from his position as Managing Director and Chairman of the Company. This was in accordance with his publicly stated plan of holding such positions for a period limited to five years. Whilst he is currently a non-executive director of the Company, Fergus McCann is not standing for re-election as a director at the Annual General Meeting of the Company to be held on 4 October 1999, and he will also be resigning from all the Subsidiaries of which he is a director. Frank O’Callaghan replaced Fergus McCann as Chairman in April 1999 and on 1 July 1999 Allan MacDonald took up the role of Chief Executive.
Summary Financial Record Year to June
| 1999 £000 |
1998 £000 |
1997 £000 |
1996 £000 |
1995 £000 |
|
| Turnover | 33,840 | 27,821 | 22,189 | 16,005 | 10,376 |
| Profit from Operations | 6,754 | 5,094 | 5,899 | 2,735 | 669 |
| Proft/(Loss) After | 330 | 7,101 | 5,152 | (1,013) |
(401 |
| Taxation Earning/(Loss) Per Share |
0.06p | 22.65p | 15.93p | (3.49p) |
(1.73p) |
| Ordinary Share* Diluted Earnings/(Loss) Per Share | 1.16p | 14.90p | 10.83p | (2.24p) |
(1.29p) |
**The earnings per share calculations have been adjusted to take account of the number of Ordinary Shares and Preference Shares in issue after the 100 for 1 share split, which took place on 21 September 1998.
Strategy
The strategy of the Company is to:-
(i) invest in all areas of the Company’s football operations, its management team, the First Team and the youth development system with the objectives of:
(a) achieving regular football success in Scottish Competitions; (b) restoring Celtic as a major football force in European Competitions;
(ii) promote improvement in domestic, British and European football with a view to enhancing the football environment in which the First Team regularly participates;
(iii)invest in Celtic Park and other commercial facilities; and
(iv) enhance awareness of and revenues from the Celtic brand in the global market;in order to increase shareholder value and customer and supporter satisfaction.
Current Trading In the period since 30 June 1999,
Celtic’s footballing operations have been strengthened by the registration of six players with the SFA and the SPL which followed the new appointments to the football management team in June 1999, all with a significant increase in costs. However, an increase in turnover has been experienced compared to the same period last year.
Prospects and Developments
The growth experienced over the last five years in ticket demand, corporate hospitality and other revenue streams has given the Board confidence that their strategy of investment in players and management has been well received by supporters and customers alike. The prospects for the full financial year will, as always, be in part determined by the success of the First Team.
However, the Directors believe the Company is well positioned to react to changes in both the football and financial environment.
The Board believes that Celtic is one of Europe’s best supported teams and that European Competitions represent a major commercial opportunity.
Details of the Placing and Offer for SaleOffer Price per Ordinary Share comprised in the Placing and Offer for Sale – 280p
Proportion of the issued Ordinary Share capital of the Company subject to the Placing and Offer for Sale – 49.65 per cent
Number of Ordinary Shares being placed firm pursuant to the Placing – 4,402,272
Number of Offered Shares being offered pursuant to the Offer for Sale – 9,997,728
Expected Timetable Record Date for priority entitlement for Qualifying – 8 September 1999
Shareholders, Season Ticket Holders and Qualifying Players and Staff Latest time for receipt of Application Forms – 10.00 am on 11 October 1999
Basis of allocation in respect of the Offer for 15 October 1999
Sale announced
Share Certificates to be despatched 22 October 1999
Priority Arrangements for Qualifying Shareholders, Season Ticket Holders and Qualifying Players and Staff
All the Offered Shares are reserved for priority applications from Qualifying Shareholders, Season Ticket Holders and Qualifying Players and Staff in the following order:
(i) first, the Offered Shares are reserved for priority applications from Qualifying Shareholders. The number of Offered Shares for which a Qualifying Shareholder can apply will depend on the number of Shares held by him or her on the Record Date;
(ii) secondly, any Offered Shares not applied for by Qualifying Shareholders in accordance with (i) above, will be reserved for additional applications from Qualifying Shareholders;(iii)thirdly, any Offered Shares not taken up by Qualifying Shareholders in accordance with (i) and (ii) above are reserved for priority applications from Season Ticket Holders who are resident in the United Kingdom or the Republic of Ireland; and
(iv) fourthly, any Offered Shares not taken up by Qualifying Shareholders and Season Ticket Holders are reserved for priority applications from persons who fall within the category – Qualifying Players and Staff.
Any Offered Shares not taken up by Qualifying Shareholders, Season Ticket Holders and Qualifying Players and Staff in accordance with the above will be made available to Other Applicants who are resident in the United Kingdom.
Donation by Fergus McCann
Fergus McCann has agreed to make a cash donation to Celtic to be used towards the capital cost required to establish a training academy. The amounts which Fergus McCann has agreed to donate are as follows:
(a) if 7,000 or more Qualifying Shareholders take up Offered Shares under the Offer for Sale, Fergus McCann will donate £500,000 to Celtic;
(b) if 10,000 or more Qualifying Shareholders take up Offered Shares under the Offer for Sale, Fergus McCann will donate, in addition to the cash sum referred to in paragraph (a) above, a further £500,000 to Celtic; and
(c) if 10,000 or more Season Ticket Holders take up Offered Shares under the Offer for Sale, Fergus McCann will donate, in addition to cash sums (if any) paid in accordance with paragraphs (a) and (b) above, £500,000 to Celtic.
Save for the prospect of receiving a cash donation as above, Celtic is not benefiting directly from the Placing and Offer for Sale.
Share Application Helpline
For queries on the procedure for application, a helpline has been set up on 0141 333 1967 between the hours of 8.00 am and 8.00 pm on Monday to Friday and 9.00 am and 6.00 pm on Saturday and Sunday.
Commenting on Fergus McCann‘s share sale arrangements, Allan MacDonald, Chief Executive of Celtic plc, said:
“We thank Fergus for his considerable efforts and contribution in creating a firm foundation for the future of the Club and the Celtic brand. We welcome the opportunity these sale arrangements give to our existing Qualifying Shareholders, Season Ticket Holders and Qualifying Players and Staff, to participate in the long term success of Celtic.”
Fergus McCann said:”I am pleased to announce the details of the sale of 14,400,000 of my shares in Celtic that enables existing shareholders and season book holders to increase substantially their ownership of their Club. “I am satisfied with the progress the Club has made over the last five years.I now look forward to once again being a full-time supporter and hopefully watching the team and Club progress to realise its true potential, which I believe is considerable.”