Quayle Munro Holdings PLC
(“Quayle Munro”, “QM” or “the Group”)

Restructuring and management buy out of Submersible Television Surveys Limited (“STS”)

Summary
Independent merchant bank, Quayle Munro Holdings PLC announces the restructuring and management buy out of Submersible Television Surveys Limited.  As a result of this, Quayle Munro will receive a cash payment of approximately £1.7m, approximately £1.9m in 8% loan stock (2008-2015) and a 49.9% interest in a new holding company, Submersible Technology Services (Holdings) Limited (“STS Holdings”).

STS is a specialist sub-sea equipment supplier to the offshore marine, oil and gas industries. With equipment located in Europe, the Middle East and the Far East, the company operates on an international basis.  STS generated pre-tax profits of approximately £1.1m for each of the financial years ending 31 December 2006 and 2007.  It currently has fixed assets of approximately £4m.

STS is a subsidiary of QM (93.3%).  The remainder of the share capital is held by the long standing chief executive, William Rodger.  STS became a subsidiary of QM in November 2006.

The financial restructuring of STS involves:

1. The immediate payment of £426,000 as a dividend (£397,415 QM, £28,585 William Rodger);

2. The redemption of
- £456,900 8% preference share capital held by QM and HSBC Global Custody Nominee (UK) Limited (£270,410 QM, £186,490 HSBC Global Custody Nominee (UK) Limited);
- £560,000 10% preference share capital held by QM and William Rodger (£500,000 QM, £60,000 William Rodger); and

3. The purchase of the entire share capital of STS by a new holding company, STS Holdings, for a consideration of £2,500,000 plus equity interests, made up as follows:-
a) By an issue of shares in STS Holdings to give a 49.9% interest in STS Holdings to QM and a 50.1% interest to the management team led by William Rodger;
b) By the issue of £2,000,000 of 8% loan stock (£1,875,640 QM, £124,360 William Rodger)
c) By the payment in cash of £500,000 to QM.

QM will therefore receive for its 93.3% ordinary share capital and its preference share capital in STS - £1,687,728 in cash, £1,875,640 in 8% loan stock 2008-2015, and the 49.9% interest in STS Holdings.

The transaction has been financed by term loan and overdraft facilities totalling £3.75m provided by Bank of Scotland, Leveraged Finance ACM, Aberdeen.

The announcement of the appointment of a non-executive Chairman and non-executive directors to the Board of STS Holdings is expected shortly.  Ian Quayle Jones, former Chairman of STS, has resigned with effect from today’s date.
 
For further information:
William Rodger, Director, STS: 01224 823333
Ian Jones, Chairman, Quayle Munro:  0131 226 4421
John Kiely / Libby Young, Smithfield: 020 7360 4900
 
Notes to Editors:
Quayle Munro (www.quayle.co.uk) is an AIM-listed independent merchant bank, active in corporate finance (including equity and debt advisory), public project finance, specialist fund management and investment on its own account.  The Group was co-founded in 1983 by its present Chairman, Ian Quayle Jones, and listed on the London Stock Exchange via an Introduction in 1993, transferring to AIM in 2003.  In July 2007 it acquired the corporate finance adviser, New Boathouse Capital, which was established by Peter Norris in 2000.  In April 2008 it also acquired international corporate finance adviser The van Tulleken Company, specialising in the publishing, information and technology industries.  With offices in London, Edinburgh and New York, the Group has an attractive spread of clients across sectors. 

STS (www.stsrov.com) is an independent business established in 1978.  STS owns and operates a fleet of 10 advanced class remotely operated vehicles specialising in international subsea intervention engineering to the offshore marine, oil and gas industries.  The organisation is structured to support pre-engineering studies and intervention tooling design.  The group provides service support, being equipment and personnel for exploration/drilling, survey construction pre/as-lay/post pipe, cable line installation and IRM platform inspection, repairs and maintenance programmes.

17 April 2008