Proposed cancellation of admission to trading on AIM
27 Juni 2008 - 1:53PM
UK Regulatory
27 June 2008
Regenesis Group plc
("Regenesis" or the "Company")
Proposed cancellation of admission to trading on AIM
The Company announces that over the past year the Directors have been seeking
ways to expand the capital base of the Company to increase its capacity to make
short term, secured loans. Regrettably, against the background of the credit
crunch, they have not been able to raise any additional equity at an acceptable
cost and consider that the low market capitalisation of the Company and the low
liquidity of the ordinary shares has made an investment in the Company
unattractive to potential investors. A further obstacle to the development of
the Company and its subsidiaries (together the "Group") is the cost of being a
public company, which the Directors estimate amounts to approximately �100,000
per annum.
The Company's bank facilities are due for renewal. In proposing renewal terms,
the Company's bankers have tightened the conditions and covenants that were
contained in the original facilities. The Directors have examined these
carefully and reached the conclusion that they will constrain the ability of
the Company to undertake new business and are unlikely to be varied
significantly by negotiation. Without a suitable bank facility in place, the
Company's ability to make short term, secured loans is further restricted.
The Directors have concluded that, as it has not been possible to raise
additional capital or renew the Group's banking facilities on favourable terms,
the Company needs to cut its costs as it reduces the scale of its activities.
Consequently, the Directors consider that it would be in the best interests of
the Company to seek cancellation of the admission of the Company's ordinary
shares to trading on AIM ("Cancellation") and to re-register as a private
limited company.
The Directors intend to repay the Group's existing bank loans on redemption of
the current loan book and to use the Group's available cash resources
cautiously to continue to make short term, secured loans. The Directors intend
to monitor market conditions, with a view to seeking bank facilities to expand
the activities of the Group as and when such facilities become available on
acceptable terms.
Under the AIM Rules, it is a requirement that cancellation of admission to
trading on AIM must be approved by not less than 75 per cent. of shareholders
voting in general meeting. Accordingly, the notice of Annual General Meeting
set out in the circular to shareholders which will be posted in the near future
contains a special resolution to approve the application to the London Stock
Exchange for cancellation of admission of the Company's shares to AIM. If the
resolution is approved, it is expected that Cancellation will take effect on 28
August 2008, being 20 business days following the date of the AGM.
Effect of the Proposal on Shareholders
The principal effects of the Cancellation would be:
(a) there would no longer be a formal market mechanism enabling the
Shareholders to trade their shares through the AIM market and the CREST
facility will be cancelled;
(b) the Company would not be bound to announce material events, nor to announce
interim or final results; and
(c) the Company would no longer be required to comply with any of the corporate
governance requirements for quoted companies.
Continued Services to Shareholders
The Board will:
(a) consider how best to implement a share dealing service for shareholders and
further notification will be made if appropriate;
(b) continue to post information relating to the Company on the Regenesis Group
website;
(c) continue to hold general meetings in accordance with the applicable
statutory requirements and the Company's articles; and
(d) continue to send Shareholders copies of the Company's audited accounts.
Further enquiries:
Regenesis Group plc Tel: 0161 929 4969
Marc Duschenes Tel: 0161 929 5088
John Barnacle
John East & Partners Limited Tel: 020 7628 2200
John East/Simon Clements
END
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