TIDMYCO
RNS Number : 1869E
YCO Group PLC
28 May 2012
28 May 2012
YCO Group plc
YCO Group plc announces intention to cancel admission to trading
on AIM
YCO Group plc (the "Company"), a leading provider of specialist
services to superyachts, today announces that, in accordance with
Rule 41 of the AIM Rules, it is seeking shareholder approval for
the cancellation of admission to trading of its ordinary shares on
AIM (the "Delisting").
An Annual General Meeting of the Company will be held at One
America Square, Crosswall, London EC3N 2SG at 10.00 am on 25 June
2012 to seek shareholder approval for the Delisting with the
Delisting anticipated to be effective, subject to that approval,
from 7.00 am on 3 July 2012.
1. Introduction
Following consultation with some of the Company's major
shareholders, the Board determined that the interests of all
Shareholders would be best served by the proposed Delisting. In
particular, the Board believes that the benefits of Admission are
no longer aligned to the strategic focus of the Company and that
the stock market has not recognised the underlying value of the
business. The Delisting will allow the management team to increase
their focus on the business itself by reducing the time and costs
currently spent adhering to the administrative and regulatory
requirements brought about by Admission.
The Company has received irrevocable undertakings, including
from those Directors who beneficially hold Ordinary Shares in the
Company, to vote in favour of the Delisting resolution from
Shareholders holding 32,839,688 Ordinary Shares, representing
approximately 67.74 per cent of the current issued share capital of
the Company.
2. Background and reasons for the Delisting
Business Background
The Company re-joined AIM via a reverse takeover by YCO SAM in
May 2008 as part of the wider strategy to form a full-service
yachting group. This strategy included the potential acquisition of
established companies and brands from within the superyacht
industry. It required the Company to have access to capital markets
in order to fund this strategy and to use its Ordinary Shares for
acquisitions.
Business restructuring
In 2009 the Board initiated a significant restructuring
programme that was focused on returning the business to
profitability and long-term growth. The outcome of this programme
led to the Company withdrawing its Yacht Help Group operations from
Spain and France and the sale of Yacht Fuel Services. The Board
decided the ongoing focus of the business should be on its core
areas of expertise in yacht management and brokerage. The Company
has successfully gone on to build a team of brokers respected
throughout the industry and continues to be an industry-leader in
yacht management.
A result of this restructuring programme was that the business
recognised that its need to undertake acquisitions, financed
through raising capital from institutional investors or by using
its Ordinary Shares as consideration, was considerably lessened.
Accordingly a primary reason for Admission was no longer valid.
Share value, cost and management focus
The Directors firmly believe that the depressed Ordinary Share
price has failed to reflect the value of the underlying business
and the lack of market liquidity has made the Ordinary Shares
unattractive as consideration for any potential investors.
Additionally, compliance with AIM Rules absorbs a considerable
amount of the time of key executives that could be more
productively spent on delivering profitable growth, increasing
market share and upholding our values of delivering an excellent
high value service for the Company's clients. The Board anticipates
that the Company will make meaningful annual savings as a result of
the Delisting.
As a result, the Board has concluded that, in addition to the
listing no longer providing strategic rationale for the development
of the business, the lack of market enthusiasm for funding small
companies, the depressed Ordinary Share price and the absence of
meaningful liquidity in the Ordinary Shares means it is no longer
in the best interests of the Company and its Shareholders for the
Company's shares to remain admitted to trading on AIM.
3. Current trading, strategy and prospects
The backdrop of a volatile economic environment, turbulent stock
markets and the ongoing euro zone crisis has continued to have a
significant impact on the key European superyacht market. Industry
wide sales have continued to be impacted, with volumes lower in the
traditionally important second quarter, which has led to the
erosion of margins as the market has responded with discounted
brokerage commissions. Whilst some smaller superyacht classes are
still maintaining reasonable volumes, these will also include
larger production sales from the main manufacturers and do not
reflect the core superyacht market on which YCO focuses
During 2011, the Company continued to implement key strategic
initiatives that have resulted in the Company being well placed to
increase its market share and maximize opportunities when
confidence returns to the sale and purchase market. In addition to
building up its industry-recognised broking teams, the Company has
broadened its geographic reach into the key American market through
establishing an office in Fort Lauderdale. Furthermore, as part of
this strategy and to complement these initiatives, the Company made
a significant investment into the global marketing of its revised
brand.
The response in 2012 to this strategy has been pleasing and
recognised by the market with enquiry levels increasing, the number
of yachts under management in the Company's fleet continuing to
grow and our anticipation that, despite there being significant
levels of supply, we will continue to increase market share in the
charter market. Continuing to build out these highly respected YCO
services remains a key component in securing brokerage contracts
when confidence returns to the market.
The Company remains wholly focused on retaining and growing
organically its market share in its core client services of
superyacht sales, charter, management and new construction and our
robust strategy is on track to achieve this. We continue to operate
in a very challenging market and the future demands that we remain
focused on strictly managing our cost base; however we remain well
placed with excellent client services to achieve our growth goals
as the market recovers. We look to the future with cautious
optimism.
4. Process for Delisting
In accordance with Rule 41 of the AIM Rules, the Company has
today notified London Stock Exchange plc of its intention to cancel
its AIM listing on 3 July 2012 conditional upon the consent of not
less than 75 per cent of votes cast by its Shareholders at the
Annual General Meeting to be held on 25 June 2012.
The Notice of Annual General Meeting contains a special
resolution proposing that the Company's Admission be cancelled.
Subject to the requisite Shareholder approval, the Delisting is
expected to be effective from 7.00 am on 3 July 2012.
5. Transactions in Ordinary Shares following Delisting
Shareholders should be aware that following the Delisting
becoming effective there will be no market facility for dealing in
the Ordinary Shares and no price will be publicly quoted for the
Ordinary Shares. As such liquidity in, and marketability of, the
Ordinary Shares will be very limited and holdings of Ordinary
Shares will be difficult to value and to trade.
The Board recognises that not all Shareholders will be able or
willing to continue to own shares in an unlisted public company
following the Delisting and that all Shareholders may still wish to
acquire or dispose of Ordinary Shares over time. The Company
therefore intends to make a 'matched bargain' facility available
shortly after the Delisting via JP Jenkins.
Shareholders should note that following the Delisting the
Company will remain subject to the provisions of the City Code on
Takeovers and Mergers (the "Code"). Shareholders will therefore be
afforded the protections afforded by the Code.
6. Annual General Meeting
The Annual General Meeting is being convened to be held at the
offices of SGH Martineau LLP, One America Square, Crosswall, London
EC3N 2SG on 25 June 2012 at 10.00 am, at which a resolution seeking
Shareholders' approval for Delisting will be proposed. To be
effective the resolution must be passed on a show of hands by at
least 75 per cent. of those Shareholders present in person or by
proxy or (being a corporation) present by a duly authorised
representative or, on a poll, by at least 75 per cent. of those
Shareholders present in person or by proxy or (being a corporation)
present by a duly authorised representative and voting at the
Annual General Meeting.
If this resolution is passed by Shareholders at the Annual
General Meeting then it is anticipated that the cancellation of
Admission will become effective from 7.00 am on 3 July 2012.
7. Recommendation
The Directors unanimously consider the Delisting to be in the
best interests of the Company and its Shareholders as a whole, and
the Directors recommend that Shareholders vote in favour of the
resolution to be proposed at the Annual General Meeting as they
intend to do in respect of their beneficial holdings of Ordinary
Shares amounting to, in aggregate, 6,852,901 Ordinary Shares
representing approximately 14.14 per cent of the current issued
share capital of the Company.
Expected Timetable of Events 2012
Publication of the Circular 28 May 2012
Latest time and date for receipt of Forms of Proxy 10.00 am on
23 June
Annual General Meeting 10.00 am on 25 June
Last day of dealings in Ordinary Shares on AIM 2 July
Cancellation of Admission with effect from 7.00 am on 3 July
For further information please contact:
YCO Group plc
Charlie Birkett, Chief Executive Tel: +377 93 50 12 12
Westhouse Securities
Tom Griffiths Tel: + 44 (0)20 7601 6100
Hudson Sandler
Charlie Jack Tel: + 44 (0)20 7796 4133
This information is provided by RNS
The company news service from the London Stock Exchange
END
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