Ace Liberty & Stone - Open Offer

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THE PURPOSES OF ARTICLE 7 OF REGULATION 596/2014

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Ace Liberty and Stone plc

(''Ace'' or "the Company'')

Proposed Open Offer of up to 18,238,835 New Ordinary Shares at 25 pence per share

Ace Liberty and Stone Plc (AQSE: ALSP), the active property investment company capitalising on commercial property investment opportunities across the UK, is pleased to announce that it will raise up to £4,559,708.75 (before fees and expenses) through an Open Offer by way of the issue of New Ordinary Shares at an Issue Price of 25 pence per New Ordinary Share. The Issue Price represents an approximate 60.09 per cent. Discount to the Closing Price of 64 pence per Ordinary Share on the Latest Practicable Date. The New Ordinary Shares will automatically be admitted to trading on the AQSE Growth Market following an announcement by the Company confirming completion of the Open Offer. It is expected that Admission will occur on 30 November 2022.

The Open Offer is conditional, inter alia, on the passing of the Resolutions by Shareholders at the General Meeting, which is to be held at 11.00am on 16 November 2022 at Finsgate, 5-7 Cranwood Street, London, EC1V 9EE. The Resolutions are set out in the Notice of General Meeting being posted to shareholders today.

The Open Offer is being made on the basis that there is no minimum subscription amount,  and accordingly applications may be accepted and New Ordinary Shares may be allotted notwithstanding that the Open Offer is not subscribed for in full.

If the Resolutions to be proposed at the General Meeting are not passed, the Open Offer will not proceed.  Those who have applied for Offer Shares will have their application and the amounts subscribed for Offer Shares returned.

Each Qualifying Shareholder will be entitled to apply for additional Offer Shares under the Excess Application Facility. The entitlement to Excess Shares is subject to the total number of Offer Shares for which applications are received during the Offer Period not being greater than the maximum of 18,238,835 New Ordinary Shares, in which case the Excess Shares for which Qualifying Shareholders have applied will be scaled back in proportion to the respective numbers of Offer Shares of those who have applied for Excess Shares.

The funding will be used to allow the Company to start implementing the strategy to acquire additional properties as set out in the section headed Background to and Reasons for the Open Offer below. The proposals allow existing shareholders to participate in the fundraising in order to raise equity for the implementation of this strategy in a cost-effective manner.

The terms and conditions of the Open Offer, including the Excess Application Facility, will be set out in the circular to Shareholders. The circular to Shareholders will set out the reasons for the Open Offer and provide further information on the Open Offer. It is expected that the circular to Shareholders will be posted on 21 October 2022 and will also be available on the Company's website, https://acelibertyandstone.com/.  Terms used in this announcement have the same meanings as set out in the Open Offer circular unless otherwise defined herein.

Background to and reasons for the Open Offer

The impact of Covid 19 in the period since March 2020 has resulted in very difficult trading conditions for all companies. Ace has performed well with a low level of defaults from tenants and minimal concessions to enable tenants to continue trading. In many cases, concessions to tenants have been compensated by improvements to the lease terms which will benefit the Company in the medium to long term. Where tenants have needed short term support by deferring rental payments, this has been concluded and all receipts are now up to date.

During the same period, the Company has repaid the maturing loan from Lloyds Banking Group with the proceeds of a new facility with Coutts and Co. This establishes Coutts as the Company's sole provider of secured finance and is a welcome confirmation of support which has been in place since 2019.

During the re-finance process, four properties were sold and the proceeds used to temporarily reduce borrowings. Following the drawdown of the new loan at a higher Loan to Value ratio, these funds are available for the acquisition of new properties.

The Company is in a strong position with a good level of rental income and a portfolio of properties which has potential for a further increase in capital value.

International events, as well as the UK political and economic situation, have created a very uncertain economic situation. The directors believe this will open up opportunities to acquire high-yielding properties to strengthen the portfolio and provide income for the coming years

The directors are conscious of the support provided by shareholders and believe it is right and fair to offer the opportunity to participate at the present time on advantageous terms.

The Board acknowledges the importance of the continuing support of shareholders.  The Open Offer gives smaller Shareholders the opportunity to participate in the fundraising. The Open Offer also enables all Qualifying Shareholders to participate in the fundraising on a pro rata basis and with the ability to apply for Offer Shares in addition to their proportionate entitlement.

Accordingly, the Directors believe that an Open Offer of New Ordinary Shares is in the best interests of the Company and Shareholders as the funds raised should enable the Company to progress with its strategy to grow the value of the portfolio of investment properties.

Current trading and outlook

The Company has recently published its results for the year ended 30 April 2022 which show an increase in profit before tax of 49% compared to the previous year. The accounts show profit before tax for the year ended 30 April 2022 of £2,066,232 compared to £1,386,072 for the comparative period a year earlier. This was achieved by a reduction in administration and finance costs which more than offset the slightly lower rental income resulting from the property sales. Shareholders' funds at 30 April 2022 were up 5.6% from £32,196,180 to £33,988,485. Furthermore the balance sheet at 30 April 2022 shows a reduction in the debt to equity ratio from 176% in 2021 to 132%.

Based on these results, the directors proposed a dividend of 3.4 pence per share payable on or about 21 October 2022, the first such payment for three years. With the conclusion of the re-finance and resumption of normal, post-Covid, trading, it is expected that dividends will continue to be paid dependent of profits earned and cash generated.

Use of Proceeds

The Company is seeking up to £4,559,708.75 to continue to build its portfolio of properties with good rental income, sound covenants and potential for capital value increases. The directors are in continuous touch with the commercial property market and constantly receive approaches for purchase and sale transactions. These are evaluated and pursued depending on the quality of the opportunity and available funds. It is not possible to specify which properties are to be purchased once the additional funding is available.  The amount that is raised by way of the Open Offer will put the Company in a better position to take advantage those opportunities that are most attractive. Future purchases will be consistent with the existing successful strategy; all property transactions are announced on the AQSE Growth Market.

Intentions of the Directors in relation to the Open Offer

The Directors intend to take up their Open Offer Entitlements (relating to Existing Ordinary Shares held by them in their own name or for which they are beneficial owners (e.g. held in a nominee account)) in full and subscribe for shares in the Excess Application Facility to subscribe for an aggregate of 1,021,192 Open Offer Shares as set out below:

Expected Timetable of Events

Admission, Settlement and dealings

The result of the Open Offer is expected to be announced on 30 November 2022.  Admission to trading of the New Ordinary Shares on the AQSE Growth Market will take place automatically following an announcement by the Company confirming completion of the Open Offer. It is expected that Admission will become effective and that dealings in the Open Offer Shares, fully paid, will commence at 8.00 a.m. on 30 November 2022.

Ismail Ghandour, Chief Executive Officer, commented:

"The directors believe the current political and economic turmoil in the UK will create opportunities for worthwhile property investment. Ace is a strong, well-positioned group which, following a successful Open Offer, will have a war chest to enable it to respond quickly to market changes for the long term benefit of shareholders."

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For further information, please contact:

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The Directors accept responsibility for this announcement.

Notes to Editors

Ace Liberty & Stone Plc is a property investment company with a diverse portfolio of properties located across the UK, predominantly in the midlands and north of England, which are now the focus of Government incentives. The Company locates commercial properties which have creditworthy tenants, several years' rental income and the potential for an increase in value through creative asset management activity, such as change of tenancy, change of use or new lease negotiation.  Ace has maintained a track record of generating strong profits at disposal of properties and achieving better-than average returns on capital. With strong support from shareholders and mortgage lenders, the Company is currently seeking to deploy its strong balance sheet and is seeking further investment opportunities in the UK to create value for existing and new investors.

Ace is run by a board with extensive property experience, an excellent network of contacts and relevant professional qualifications. This sector expertise has allowed the Board to identify opportunities and act promptly to secure investments.

For more information on the Company please visit www.acelibertyandstone.com