TIDMCLEA
RNS Number : 4126Z
Cleardebt Group PLC
07 March 2013
ClearDebt Group plc
7(th) March 2013
CLEARDEBT GROUP PLC ("CLEARDEBT" OR "THE COMPANY")
PROPOSED CANCELLATION OF AIM ADMISSION AND NOTICE OF GENERAL
MEETING
ClearDebt announces that it is seeking Shareholder approval for
the cancellation of admission to trading on AIM of its Ordinary
Shares ("Cancellation").
A General Meeting ("GM") is being convened to be held on 25(th)
March 2013 at 2pm at Nelson House, Park Road, Timperley, Cheshire
WA14 5BZ at which a resolution which seeks Shareholder approval for
the Cancellation will be proposed.
A circular convening the General Meeting will be posted to
Shareholders. Copies of the circular will shortly be available on
the Company's website: www.cleardebtgroup.co.uk.
EXPECTED TIMETABLE OF PRINCIPAL EVENTS:
Latest time and date for receipt of Forms of Proxy for the GM
2pm on Thursday 21(st) March 2013
Time and date of GM 2pm on Monday 25(th) March 2013
Cancellation of admission to trading on AIM of the Ordinary
Shares 7am on Wednesday 10(th) April
2013
The dates and times are based on the Company's expectation and
may be subject to change. Any changes to the expected timetable
will be announced publicly.
CONTACTS:
ClearDebt Group plc:
David Mond (Chief Executive Officer) 0161 968 6806
David Shalom (Finance Director) 0161 968 6847
Seymour Pierce (Broker & Nominated Advisor):
Guy Peters/David Banks/Katie Ratner 0207 107 8000
The following information is extracted from a circular to
Shareholders (the "Circular") expected to be posted today. Copies
of the Circular will be available at the offices of Seymour Pierce
Limited (20 Old Bailey, London EC4M 7EN) upon request. Definitions
used in the Circular apply in this announcement, unless the context
otherwise requires:
Proposed cancellation of the Company's AIM listing
1. Introduction
The purpose of this letter is to provide you with the background
to and the reasons for the proposed cancellation of the Company's
listing on the AIM market of the London Stock Exchange plc ("AIM")
(the "Cancellation"), and to explain why the directors consider
this proposal to be in the best interests of the Company and
Shareholders as a whole, and to seek your approval to the proposal
at the general meeting of the Company convened for this purpose
(the "GM").
2. Reasons for the proposed Cancellation
Concerns over the recent share price performance of the Company
have led the Directors to undertake a review of the merits or
otherwise of the Company continuing to be admitted to trading on
AIM ("Admission"). The Directors have concluded that a proposal to
cancel the Admission should be made to Shareholders in general
meeting. In reaching the decision to propose this to Shareholders,
the Directors have taken the following factors into account:-
2.1 given the overall market, the Directors are of the opinion
that it is difficult for the Company to attract any or meaningful
equity investment through its listing on AIM;
2.2 the AIM Listing of the Ordinary Shares is not offering
investors the opportunity to trade in meaningful volumes within the
relative market;
2.3 the Company, like many other small AIM companies, has a
tightly held register of Shareholders and suffers from a lack of
liquidity for its ordinary shares. The current share register shows
that more than 61% of the Company's ordinary shares are held by 17
Shareholders. In practical terms, this results in a small free
float and low trading volumes, which further reduces demand for the
Ordinary Shares;
2.4 it is unlikely that the Company will be able to raise money
through a new share issue or issue new shares in connection with an
acquisition and therefore the lack of ordinary shares in free float
and low trading volumes will continue;
2.5 there is limited investor appreciation of the Company's
business areas and increasing difficulty in attracting and
maintaining institutional investors in the Company, particularly in
the current economic environment;
2.6 the Directors estimate that annual direct and indirect costs
of maintaining the listing of the ordinary shares on AIM are at
least GBP93,455. This estimate includes listing expenses and AIM
advisory fees (and excludes any indirect costs savings associated
with a considerable amount of senior executive time which is
currently spent dealing with issues relating to the AIM listing).
The Directors consider that these costs are disproportionately high
to the benefits of trading on AIM and that these funds could be
better utilised in running the business;
2.7 the current economic turmoil and the susceptibility of the
share price to the wider general equity market conditions is not to
the benefit of the business;
2.8 the impact (at least in the short term) on the Company's
share price arising as a result of the new debt management protocol
announced on 7 February 2013 which could have a negative impact on
the Company's cash flow and profitability in the short to medium
term.
3. Process for Cancellation
In accordance with Rule 41 of the AIM Rules, the Company has
notified AIM Regulation of the intention to delist, giving at least
20 Business Days notice. Under the AIM Rules, it is also a
requirement that the Cancellation must be approved by not less than
75 per cent of those present and entitled to vote or voting by
proxy in a general meeting. Accordingly, the resolution set out in
the notice of GM ("Resolution") seeks Shareholder approval for the
Cancellation. Subject to the Resolution being passed by the
requisite majority at the GM, and following a further five Business
Days (which must pass following approval by the Shareholders in
accordance with the AIM Rules), it is expected that trading on AIM
in the Ordinary Shares will cease at the close of business on
Tuesday 9(th) April 2013 with the Cancellation becoming effective
from 7.00am on Wednesday 10(th) April 2013.
4. Effect of the Cancellation on Shareholders
The principal effects of the Cancellation would be that:-
4.1 there would no longer be a formal market mechanism enabling
Shareholders to trade their shares on AIM or any other market or
trading exchange;
4.2 the Company would not be bound to announce material events,
such as interim or final results, material transactions or
administrative changes;
4.3 the Company would no longer be bound to comply with the
corporate governance requirements for companies with shares
admitted to trading on AIM;
4.4 the Company would no longer be required to comply with the
AIM Rules (or to have a nominated advisor), and Shareholders would
no longer be required to vote on certain matters prescribed by the
AIM Rules;
4.5 Shareholders will not be able to read the Company's share price in the daily newspapers;
4.6 interim reports will not be sent to Shareholders and, as a
result, Shareholders will only receive the annual report once a
year; and
4.7 the Company's CREST facility will be cancelled and although
the Ordinary Shares will remain transferable, they will cease to be
transferable through CREST. Instead, Shareholders who hold Ordinary
Shares in CREST will receive share certificates.
However, the Directors intend to continue to operate the Company
for the benefit of all Shareholders. They also intend to continue
to keep Shareholders informed of progress and remain committed to
high standards of corporate governance. As such, the Directors
will:-
4.8 post items of news on the Company's website (www.cleardebtgroup.co.uk);
4.9 hold annual general meetings and general meetings in
accordance with statutory requirements and the Company's Articles
of Association (the "Articles");
4.10 continue to send to Shareholders copies of the Company's audited accounts each year; and
4.11 operate the Company with the corporate governance
appropriate to a company with approximately 280 shareholders.
Following the Cancellation, although the Ordinary Shares will
remain transferable they will no longer be tradable on AIM and no
other trading facility will be available to facilitate the trading
of the Ordinary Shares. Consequently, it is likely to be more
difficult for a Shareholder to purchase or sell any Ordinary Shares
following the Cancellation. The Directors intend, however, to
review on an ongoing basis whether they can facilitate trading on a
matched bargain basis in the UK and Shareholders interested in any
such potential matched bargain arrangements should contact the
Company Secretary, David Mond on 00 44 161 968 6806 in the first
instance. Following the Cancellation, transfers of Ordinary Shares
may be effected in accordance with those provisions of the Articles
concerning off-market transfers of shares in certificated form.
It is the Company's intention to cancel the CREST facility
following the passing of the resolutions at the GM and arrangements
will be made to send share certificates to those Shareholders (at
their risk) currently using CREST.
Shareholders should note that, even if the Cancellation is
approved and becomes effective, the Company will remain subject to
the provisions of the City Code on Takeovers and Mergers for a
period of 10 years. The City Code provides an orderly framework
within which takeovers and mergers are conducted and operates
principally to ensure that shareholders are treated fairly and not
denied an opportunity to decide on the merits of a takeover and
that shareholders of the same class are afforded equivalent
treatment. The City Code will however cease to apply to the Company
10 years after the Cancellation becomes effective. However, the
regulatory regime imposed through the AIM Rules, which applies
solely to companies with shares admitted to trading on AIM, will no
longer apply. Upon the Cancellation becoming effective, Seymour
Pierce Limited, will therefore cease to be nominated adviser and
broker to the Company.
5. Expected Timetable of Events
Despatch of this document and form of proxy Thursday 7(th)
and notice provided to London Stock Exchange March 2013
to cancel the Admission
Latest time and date for receipt of Forms 2pm on Thursday
of Proxy in respect of the GM 21(st) March
2013
Time and date of the GM 2pm on Monday
25(th) March
2013
Expected last day of dealings in Ordinary Tuesday 9(th)
Shares on AIM April 2013
Expected date of Cancellation 7am on Wednesday
10(th) April
2013
Each of the times and dates in this timetable is subject to
change. If any of the above time and/or dates change, the revised
times and dates will be notified to Shareholders by an announcement
through a regulatory information service recognised by the London
Stock Exchange.
6. General Meeting
The notice convening the GM to be held at Nelson House, Park
Road, Timperley, Cheshire WA14 5BT at 2pm on Monday 25(th) March
2013 is set out at the end of this document to approve, as a
special resolution, the Cancellation.
7. Action to be taken
You will find enclosed with this document a form of proxy for
use at the GM. Whether or not you propose to attend the GM in
person you are requested to complete the form of proxy and return
it to Neville Registrars Limited, Neville House, 18 Laurel Lane,
Halesowen, West Midlands, B63 3DA, so as to arrive no later than
2pm on 21(st) March 2013. The completion and return of the form of
proxy will not affect your right to attend and vote in person at
the GM if you so wish.
8. Recommendation
The Directors believe that the proposed Resolution is in the
best interests of the Company and unanimously recommend that you
vote in favour of it as they intend to do in respect of their own
beneficial shareholdings of 125,565,618 Ordinary Shares which
represent the equivalent of 40.68 per cent of the issued Ordinary
Shares.
The Directors, those connected with them and other Shareholders
have irrevocably undertaken to vote in favour of the proposed
resolution in respect of an aggregate of 211,294,246 Ordinary
Shares (including the 125,565,618 Ordinary Shares referred to
above), representing approximately 68.46 per cent of the issued
Ordinary Share capital of the Company.
This information is provided by RNS
The company news service from the London Stock Exchange
END
STRUNANROOAORAR
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