Zamano sells assets to management team for €1
Mobile business solutions company Zamano has announced that it has entered into a conditional sale and purchase agreement to sell all of the company's operating business and assets to its management team of Brian Gilsenan and Michael Connolly for €1.
Following the completion of the disposal shareholders can expect to benefit from €5.3m in cash, with the company left with no other significant assets or liabilities.
The news follows a decision taken by the company in February this year to wind down its existing business lines in order to protect the cash position on the company's balance sheet.
After consideration, the board decided that the wind-down would most effectively be completed by a sale of the company's remaining operating business and assets comprising its premium rate SMS business.
The deal, based on an effective date of 30 June, requires that nearly €1m be left in the operating companies to account for the amount by which their liabilities exceeded their assets.
A further €555,000 is being given to Mr Gilsenan and Mr Connolly's company Kilavan, mainly to provide for potential future liabilities which may require an indemnification.
It is expected to take up to six months for the €5.3m in cash to be returned to the shareholders, during which time the board, in a statement released to the stock market, said that it would "continue to examine possible investment opportunities".
"Any material or significant investment opportunity will be conditional on shareholder approval being obtained," a statement from the company said.
An emergency general meeting to approve the disposal and the investing policy is expected to be held at the Conrad Hotel in Dublin 2 on 30 August.
Colin Tucker, interim chairman at Zamano, said that the board had worked hard to achieve the disposal and "carefully compared and considered the merits of the disposal against all alternatives that were available to the company".
Mr Tucker also said that the board was satisfied that the disposal provided the company with the most appropriate option in terms of maximising the amount of cash that will be available for distribution to shareholders or reinvestment, minimising the remaining contingent liabilities of the group and the risk that the remaining cash will not be available for shareholders.
He added it would provide the highest level of certainty regarding completion and costs, and achieving the highest level of simplification of the remaining group structure.
"We believe the disposal is the most favourable outcome for our shareholders at this time," Mr Tucker said.