Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 

Renaissance sounds death knell before meeting to sell Yoobee

Renaissance sounds death knell ahead of meeting to sell Yoobee

By Paul McBeth

Jan. 14 (BusinessDesk) - Renaissance Corp ultimately plans to wind itself up once it sells its Yoobee School of Design and deals with its ailing retail business, returning capital to shareholders. The shares jumped 28 percent to 15.4 cents.

The company will ask shareholders at a special meeting on Jan. 29 in Auckland to approve the sale of Yoobee to Academic Colleges Group for a net $13.3 million, with a potential earn-out of up to $1 million based on 2014 earnings. Independent adviser KordaMentha considered the deal fair to the company’s shareholders.

The sale comes after Renaissance failed to find a viable plan to deal with its retail business after “another terrible year in 2013,” chairman Colin Giffney said in a letter to shareholders recommending the deal.

The proceeds will go towards repaying debt, and would leave cash reserves of about $7 million, most of which will be held to distribute to shareholders on the resolution of its retail issues.

Renaissance’s board intends to sell the retail unit, wind up the company and distribute the funds to shareholders.

“As I write, we are still some way from achieving that goal,” Giffney said.

Renaissance flagged the sale in October last year, saying its Yoobee-branded Apple only retail stores were no longer viable.

If the sale doesn’t go ahead, Renaissance will have to deal with its retail unit and set up Yoobee as a small publicly listed company in its own right.

“In our view, if shareholders elect to reject the proposal, the share price will fall, perhaps quite significantly, until we have resolved the retail issues and, potentially, recapitalised Renaissance,” Giffney said. “It could take two years or more for the share market to attribute the value to shareholders offered now by this sale (if at all).”

Giffney said the company has been hindered at times by its bigger shareholders who “openly expressed their preference not to inject new funds,” which at times “would have made sense.”

The board had “differing views on many of these issues” but agreed on “the material matters affecting Renaissance,” he said.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

NZ's Space Programme: Rocket Lab Makes It To Space (But Not Orbit)

Electron lifted-off at 16:20 NZST from Rocket Lab Launch Complex 1 on the Mahia Peninsula in New Zealand. It was the first orbital-class rocket launched from from a private launch site in the world. More>>

ALSO:

Earlier:

Budget: Irrigate (Good Times, Come On!)

Additional grant funding of $26.7 million over the next three years plus a capital boost of $63 million towards irrigation investments in Budget 2017 will deliver economic and environmental benefits through better use of water... More>>

ALSO:

Silver Fern Farms: Proposal To Close Fairton Sheepmeat Plant

Silver Fern Farms has advised its people of the proposal to permanently close the site, and has discussed potential transfer options to its other sites in the region as part of the consultation process...
More>>

ALSO:

MPI: Myrtle Rust Appears In Taranaki

The nursery in Waitara (just north of New Plymouth) reported suspected myrtle rust symptoms on young plants to the Ministry’s 0800 number yesterday (Tuesday). More>>

ALSO: