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21 May 2010
DANIEL STEWART SECURITIES PLC
(AIM: DAN)
("Daniel Stewart" or "the Company")
COMPLETION OF ACQUISITION AND TRADING UPDATE
Completion of acquisition
Daniel Stewart, stockbroker and corporate finance adviser to smaller and medium-sized companies, is pleased to announce, further to its announcement of 18 February 2010 ("Original Announcement"),that it yesterday completed the acquisition of MENA-RL ("MENA") through the issue of 25 million new Daniel Stewart ordinary shares of 0.25 pence ("Ordinary Shares").
The Company has agreed with Adam Wilson, the sole owner of MENA prior to the acquisition, that the terms of the consideration would be varied as follows:
- 25,000,000 new Ordinary Shares issued at completion, of which 12,275,000 new Ordinary Shares will be onward distributed by Mr Wilson to certain employees of MRL Holdings Limited; and
- deferred consideration, to be issued on the first anniversary of completion in a form at the discretion of Daniel Stewart, comprising either 25,000,000 new Ordinary Shares or an equivalent cash payment at 1.5p per Ordinary Share.
Trading update
Since the year end on 31 March 2010, and with the integration of MENA (with offices in Dubai and Cape Town), the Company has seen a significant increase in turnover and a return to profitability. Since the Original Announcement, the Company has also benefited from a significant inflow of new capital from new and existing shareholders, including approximately £600,000 from its own employees.
Both April and May are expected to be profitable (un-audited) and, with the current business pipeline, the Directors are confident that this trend will continue going forward.
The Company, in conjunction with Mr Wilson, has agreed that he will delay his previously announced permanent move back from the Middle East to the UK for up to 12 months. There has been a significant increase in business, which has been partly driven following the Original Announcement, and an increase in the level of activity in the US OTC QX market. The Company would like to ensure that the momentum achieved in its performance is sustained.
The Directors believe that during this 12 month period, the Company and MENA will continue to source and execute new international business from a developing pipeline. Mr Wilson will continue to assist and orchestrate international distribution throughout Africa, the Gulf Cooperative Council (GCC) and Middle East. Daniel Stewart intends to bring to market in the near future a company operating in the GCC region.
In order to sustain this distribution, Mr Wilson will maintain his residency in the United Arab Emirates. As such, it has been decided that Peter Shea will continue in his role as both Chairman and Chief Executive of the Company for a further 12 months and Mr Wilson has indicated that he intends to step down from the Board of Daniel Stewart as Non-Executive Director in the interim period. A further announcement will be made in due course.
The Board anticipates that the unaudited results for the period will demonstrate revenues of approximately £4.0 million, which give rise to an un-audited loss of approximately £3.0 million. The Company expects to announce its preliminary final results for the twelve month period ending 31 March 2010 by the end of July 2010.
Peter Shea, Chairman and Chief Executive of Daniel Stewart, said: "We are delighted with the level of trading we have managed to secure for the period. The Board, along with Mr Wilson, has decided that it is best for him to prolong his stay in the Middle East so that we can keep the momentum going and continue to take advantage of interest from international markets.
"I would like to take this opportunity to thank all of our employees for their continued hard work and welcome all our new shareholders on board."
Further information:
Daniel Stewart Securities plc
Peter Shea, Chief Executive Officer Tel: 020 7776 6550
Arbuthnot Securities Limited
Nick Tulloch Tel: 020 7012 2158
Bishopsgate Communications
Nick Rome/Siobhra Murphy Tel: 020 7562 3366
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