TIDMGYG
RNS Number : 5320U
GYG PLC
02 August 2022
The information contained within this announcement is deemed by
the Company to constitute inside information for the purposes of
Article 7 of Regulation (EU) 596/2014, as it forms part of the
domestic law of the United Kingdom by virtue of the European Union
(Withdrawal) Act 2018. Upon the publication of this announcement
via the Regulatory Information Service, this inside information is
now considered to be in the public domain.
2 August 2022
GYG plc
("GYG", the "Company" or the "Group")
Proposed cancellation of admission of Ordinary Shares to trading
on AIM,
Notice of General Meeting,
Re-Registration as a Private Limited Company
and
Adoption of New Articles of Association
GYG (AIM: GYG) announces the proposed cancellation of admission
of its ordinary shares to trading on AIM ("Cancellation"),
re-registration as a private limited company ("Re-registration")
and adoption of new articles of association ("New Articles").
A circular will be sent to Shareholders in the coming days,
setting out the background to and reasons for the proposed
Cancellation and the Re-registration and associated adoption of the
New Articles ("Circular"). The Circular will also contain a notice
convening a general meeting ("General Meeting") at which
Shareholders are invited to consider and, if thought fit, approve
the proposed Cancellation and the Re-registration and associated
adoption of the New Articles.
The Directors have undertaken a review to evaluate the benefits
and drawbacks to the Company and its Shareholders of retaining the
listing of the Ordinary Shares on AIM. This review has included,
amongst other matters, the impact of the current geopolitical
situation, the compatibility of the requirements for transparency
within public markets and client discretion, the public market
share trading and valuation volatility of the Company and the
increasing costs of maintaining a public listing. For these
reasons, the Directors have concluded that Cancellation and
Re-registration are in the best interests of the Company and its
Shareholders as a whole. A detailed explanation of these reasons is
set out in Appendix I to this announcement.
To be passed, the Cancellation Resolution requires, pursuant to
Rule 41 of the AIM Rules, the approval of not less than 75 per
cent. of the votes cast by Shareholders at the General Meeting. The
resolution to approve the Re-registration and the adoption of New
Articles also requires the approval of not less than 75 per cent.
of the votes cast by shareholders at the General Meeting.
Should the Cancellation be approved by Shareholders at the
General Meeting, the Company will consider implementing a matched
bargain facility with a third party matched bargain facility
provider which would facilitate Shareholders buying and selling
Ordinary Shares on a matched bargain basis following Cancellation.
In determining whether to put a Matched Bargain Facility in place,
the Company shall consider expected (and communicated) Shareholder
demand for such a facility, as well as the makeup of the share
register following the Cancellation. Shareholders should be aware
that the implementation of a Matched Bargain Facility is only under
consideration at this stage and there can be no guarantee that the
Company will conclude that putting a Matched Bargain Facility in
place is beneficial for Shareholders.
The General Meeting will be held at the offices of Dickson Minto
W.S. at 16 Charlotte Square, Edinburgh EH2 4DF at 10:30 a.m. on 31
August 2022.
The notice convening the General Meeting and setting out the
Resolutions to be considered at it will be set out in a Circular
which is expected to be posted to Shareholders in the coming days,
extracts of which can be found in Appendix I to this
announcement.
Capitalised terms in this announcement, unless otherwise
defined, have the same meaning as will be set out in the
Circular.
A copy of the Circular and the New Articles will be made
available on the Company's website at www.gygplc.com in the coming
days.
For further information, please contact:
GYG plc via FTI Consulting
Richard McGuire, Non-executive Chairman Tel: +44 (0) 20 3727
Remy Millott, Chief Executive Officer 1000
Kevin McNair, Chief Financial Officer
Singer Capital Markets Tel: +44 (0) 20 7496
Tom Salvesen 3000
Peter Steel, Amanda Gray
FTI Consulting Tel: +44 (0) 20 3727
Alex Beagley 1000
Fiona Walker gyg@fticonsulting.com
Rafaella de Freitas
Notes to Editors:
GYG is a superyacht painting, supply and maintenance company,
offering services globally through operations in the Mediterranean,
Northern Europe and the United States. The Company's brands include
Pinmar, Pinmar Yacht Supply, and Technocraft. GYG's operations can
be divided into three key sales channels:
-- Refit: repainting and finishing of superyachts, normally as
part of a refit programme. Revenues also include scaffolding,
containment and the removal and repair of fittings
-- New Build: fairing and painting of new vessels as part of the build process
-- Supply: the sale and delivery of maintenance materials,
consumables, spare parts and equipment primarily to superyachts and
trade customers
APPIX I - EXTRACTS FROM THE CIRCULAR TO SHAREHOLDERS
Background to and reasons for the Cancellation and
Re-registration
The Directors have undertaken a review to evaluate the benefits
and drawbacks to the Company and its Shareholders of retaining the
listing of the Ordinary Shares on AIM. This review has included,
amongst other matters, the impact of the current geopolitical
situation, the compatibility of the requirements for transparency
within public markets and client discretion, the public market
share trading and valuation volatility of the Company and the
increasing costs of maintaining a public listing. For these
reasons, the Directors have concluded that Cancellation and
Re-registration are in the best interests of the Company and its
Shareholders as a whole. Further details of the background to and
reasons for the Cancellation and Re-registration are set out
below:
-- The Directors believe that a number of factors have impaired
investor sentiment towards the Company, including, amongst others:
(a) the Company's exposure to events outside its control impacting
its recent trading performance; (b) current market conditions and
the lack of new investor appetite for the industry as a result of
the current geo-political climate; and (c) short term UK market
volatility.
-- Further, the Directors believe that growing the Group's
business within the parameters of a publicly quoted company will be
more challenging due to: (a) continuing adverse sentiment towards
the Company as referred to above and, more generally, around the
superyacht sector in which the Group operates; and (b) the legal
and regulatory burden associated in maintaining the Company's AIM
listing. Due to the nature of the Company's business, its clients
are sensitive to issues of privacy and, as a result, the Company
operates under comprehensive non-disclosure agreements. The
identity of the Company's clients, as well as a number of projects
it undertakes, cannot be disclosed and this, in the opinion of the
Directors, is misaligned with the typical expectations of public
equity market investors. On the converse, the disclosures which are
required to be made by the Company mean that the Company's peers
have a far greater insight into its strategy, operational
activities and future plans than the Company has into theirs, a
factor which reduces the Company's relative competitiveness. These
factors have all led the Directors to consider that the Company's
business may no longer be appropriate for that of a publicly quoted
company.
-- Due to the disruption suffered by the Company as a result of
recent external events, the Directors believe that having access to
capital in the near to medium-term may be prudent to ensure that
the Company can capitalise successfully on future opportunities and
growth and, as a result of the factors set out above, the Directors
consider it unlikely that an equity fundraise using the public
markets would successfully raise additional capital (or provide the
optimal platform to do so), should it be so required.
-- More generally, the UK small and micro-cap public markets
have changed significantly since the Company's IPO and the
Directors believe that the Company's current public market
valuation does not reflect the underlying potential of the business
with the result that growth prospects are more readily accessible
and managed in a private market environment.
-- There has been limited liquidity in the Ordinary Shares for
some time and, as a result, the Directors believe that continued
admission to trading on AIM no longer sufficiently provides the
Company with the advantage of providing access to capital in the
medium to longer-term, nor provides liquidity to investors. As a
result, the Directors have concluded that the most likely source of
future funds would be through private capital and debt funding.
-- The considerable cost, management time and the legal and
regulatory burden associated with maintaining the Company's
admission to trading on AIM is, in the Directors' opinion,
disproportionate to the benefits of the Company's continued
admission to trading on AIM. Given the lower costs associated with
private limited company status, it is estimated that the
Cancellation and Re-registration will materially reduce the
Company's recurring administrative and adviser costs by
approximately EUR700,000 per annum, which the Directors believe can
be better spent supporting growth in the Group's business.
-- As a result of the limited liquidity in Ordinary Shares
highlighted above, the listing of the Ordinary Shares on AIM does
not necessarily offer investors the opportunity to trade in
meaningful volumes or with frequency within an active market. With
low trading volumes, the Company's share price can move up or down
significantly following trades of small volumes of Ordinary Shares.
In the opinion of the Directors, the adverse share price
performance is detrimental to the perception of the Group amongst
customers, suppliers and other partners, which, in turn, has
negatively impacted its staff morale and industry reputation as
highlighted above.
Following careful consideration, the Directors believe that it
is in the best interests of the Company and Shareholders to seek
the proposed Cancellation and Re-registration.
In addition, in connection with the Re-registration, it is
proposed that the New Articles be adopted to reflect the change in
the Company's status to a private limited company. The principal
effects of the Re-registration and the adoption of the New Articles
on the rights and obligations of Shareholders and the Company are
summarised in the Circular.
Process for, and principal effects of, the Cancellation
The Directors are aware that certain Shareholders may be unable
or unwilling to hold Ordinary Shares in the event that the
Cancellation is approved and becomes effective. Such Shareholders
should consider selling their interests in the market prior to the
Cancellation becoming effective.
Under the AIM Rules, the Company is required to give at least 20
clear Business Days' notice of Cancellation. Additionally,
Cancellation will not take effect until at least five clear
Business Days have passed following the passing of the Cancellation
Resolution. If the Cancellation Resolution is passed at the General
Meeting, it is proposed that the last day of trading in Ordinary
Shares on AIM will be 7 September 2022 and that the Cancellation
will take effect at 7.00 a.m. on 8 September 2022.
The principal effects of the Cancellation will include the
following:
-- there will be no formal market mechanism enabling the
Shareholders to trade Ordinary Shares;
-- it is possible that, following the publication of this
announcement, the liquidity and marketability of the Ordinary
Shares is reduced and their value adversely affected (however, as
set out above, the Directors believe that the existing liquidity in
the Ordinary Shares is in any event limited);
-- the Ordinary Shares may be more difficult to sell compared to
shares of companies traded on AIM (or any other recognised market
or trading exchange);
-- in the absence of a formal market and quote, it may be
difficult for Shareholders to determine the market value of their
investment in the Company at any given time;
-- the regulatory and financial reporting regime applicable to
companies whose shares are admitted to trading on AIM will no
longer apply;
-- Shareholders will no longer be afforded the protections given
by the AIM Rules, such as the requirement to be notified of price
sensitive information or certain events and the requirement that
the Company seek shareholder approval for certain corporate
actions, where applicable, including substantial transactions,
reverse takeovers, related party transactions and fundamental
changes in the Company's business, including certain acquisitions
and disposals;
-- the levels of disclosure and corporate governance within the
Company may not be as stringent as for a company quoted on AIM;
-- the Company will no longer be subject to UK MAR regulating
inside information and other matters;
-- the Company will no longer be required to publicly disclose
any change in major shareholdings in the Company under the
Disclosure Guidance and Transparency Rules;
-- the Takeover Code will cease to apply to the Company
following the Cancellation and Re-registration;
-- Singer Capital Markets will cease to be nominated adviser to the Company;
-- whilst the Company's CREST facility will remain in place
immediately post the Cancellation, the Company's CREST facility may
be cancelled in the future and, although the Ordinary Shares will
remain transferable, they may cease to be transferable through
CREST (in which case, Shareholders who hold Ordinary Shares in
CREST will receive share certificates);
-- stamp duty will be due on transfers of shares and agreements
to transfer shares unless a relevant exemption or relief applies to
a particular transfer; and
-- the Cancellation and Re-registration may have personal
taxation consequences for Shareholders. Shareholders who are in any
doubt about their tax position should consult their own
professional independent tax adviser.
The above considerations are not exhaustive, and Shareholders
should seek their own independent advice when assessing the likely
impact of the Cancellation on them.
For the avoidance of doubt, the Company will remain registered
with the Registrar of Companies in England & Wales in
accordance with and, subject to the Companies Act, notwithstanding
the Cancellation and Re-registration.
The Company currently intends to continue to provide certain
facilities and services to Shareholders that they currently enjoy
as shareholders of an AIM company. The Company will:
-- continue to communicate information about the Company
(including annual accounts) to its Shareholders, as required by the
Companies Act; and
-- continue, for at least 12 months following the Cancellation, to maintain its website, https://www.gygplc.com (albeit the domain name may be altered as a result of changes to the Company's name in connection with the Cancellation and Re-registration) and to post updates on the website from time to time, although Shareholders should be aware that there will be no obligation on the Company to include all of the information required under the Disclosure Guidance and Transparency Rules, AIM Rule 26 or to update the website as required by the AIM Rules.
There will be no change to the composition of the Board
immediately following the Cancellation and Re-registration. Richard
McGuire and Richard King (being the two Non-Executive Directors of
the Company) have, however, notified the Company that they are
considering stepping down from their roles as directors in the
period shortly following the Cancellation and Re-registration. A
key purpose of their current positions is to bring independence to
the Board, and help ensure that the Company meets its obligations
under the AIM Rules, and such a role is unlikely to exist or be
economically or operationally justified should the Cancellation and
Re-registration take place.
The Resolutions to be proposed at the General Meeting include
the adoption of the New Articles, with effect from the
Re-registration. A summary of the principal differences between the
Current Articles and the proposed New Articles is included in the
Circular. A copy of the New Articles can be viewed at
https://www.gygplc.com.
Transactions in the Ordinary Shares prior to and post the
proposed Cancellation
Prior to Cancellation
Shareholders should note that they are able to continue trading
in the Ordinary Shares on AIM prior to Cancellation.
Dealing and settlement arrangements
The Directors are aware that Shareholders may wish to acquire or
dispose of Ordinary Shares in the Company following the
Cancellation. Should the Cancellation be approved by Shareholders
at the General Meeting, the Company will consider implementing a
matched bargain facility with a third party matched bargain
facility provider which would facilitate Shareholders buying and
selling Ordinary Shares on a matched bargain basis following
Cancellation ("Matched Bargain Facility").
In determining whether to put a Matched Bargain Facility in
place, the Company shall consider expected (and communicated)
Shareholder demand for such a facility, as well as the makeup of
the share register following the Cancellation. Shareholders should
be aware that the implementation of a Matched Bargain Facility is
only under consideration at this stage and there can be no
guarantee that the Company will conclude that putting a Matched
Bargain Facility in place is beneficial for Shareholders. If put in
place, Shareholders should also be aware that any such Matched
Bargain Facility could also be withdrawn at a later date. Further
details will be communicated to the Company's shareholders at the
relevant time.
If Shareholders wish to buy or sell Ordinary Shares on AIM they
must do so prior to the Cancellation becoming effective. As noted
above, in the event that Shareholders approve the Cancellation, it
is anticipated that the last day of dealings in the Ordinary Shares
on AIM will be 7 September 2022 and that the effective date of the
Cancellation will be 8 September 2022.
Current Trading, Strategy and Prospects
The Company has today separately notified a trading update for
the six months ended 30 June 2022. The text of that announcement
will be included in the Circular.
Re-registration
As set out above, following the Cancellation, the Directors
believe that the requirements and associated costs of the Company
maintaining its public company status will be difficult to justify
and that the Company will benefit from the more flexible
requirements and lower costs associated with private limited
company status. It is therefore proposed to re-register the Company
as a private limited company. In connection with the
Re-registration, it is proposed that the New Articles be adopted to
reflect the change in the Company's status to a private limited
company. The principal effects of the Re-registration and the
adoption of the New Articles on the rights and obligations of
Shareholders and the Company are summarised in the Circular.
An application will be made to the Registrar of Companies for
the Company to be re-registered as a private limited company.
Re-registration will take effect when the Registrar of Companies
issues a certificate of incorporation on Re-registration. The
Registrar of Companies will issue the certificate of incorporation
on Re-registration when it is satisfied that no valid application
can be made to cancel the resolution to re-register as a private
limited company or that any such application to cancel the
resolution to re-register as a private limited company has been
determined and confirmed by the Court.
Takeover Code
The Takeover Code applies to all offers for companies which have
their registered offices in the United Kingdom, the Channel Islands
or the Isle of Man if any of their equity share capital or other
transferable securities carrying voting rights are admitted to
trading on a regulated market or a multilateral trading facility in
the United Kingdom or on any stock exchange in the Channel Islands
or the Isle of Man.
The Takeover Code also applies to all offers for companies (both
public and private) which have their registered offices in the
United Kingdom, the Channel Islands or the Isle of Man and which
are considered by the Panel to have their place of central
management and control in the United Kingdom, the Channel Islands
or the Isle of Man, but in relation to private companies only if
one of a number of conditions are met, including that any of the
company's equity share capital or other transferable securities
carrying voting rights have been admitted to trading on a regulated
market or a multilateral trading facility in the United Kingdom or
on any stock exchange in the Channel Islands or the Isle of Man at
any time in the preceding 10 years.
If the Cancellation and Re-registration are approved by
Shareholders at the General Meeting, the Company will be
re-registered as a private company and its securities will no
longer be admitted to trading on a regulated market or a
multilateral trading facility in the United Kingdom. In these
circumstances, the Takeover Code will only apply to the Company if
it is considered by the Panel to have its place of central
management and control in the United Kingdom, the Channel Islands
or the Isle of Man. This is known as the "residency test". In
determining whether the residency test is satisfied, the Panel has
regard primarily to whether a majority of a company's directors are
resident in these jurisdictions.
The Panel has confirmed to the Company that, on the basis of the
current residency of the Directors, the Company will not have its
place of central management and control in the United Kingdom
following the Cancellation and Re-registration. As a result, if the
Cancellation and Re-registration are approved by Shareholders at
the General Meeting and become effective, the Takeover Code will
cease to apply to the Company and Shareholders will no longer be
afforded the protections provided by the Takeover Code, including
the requirement for a mandatory cash offer to be made if
either:
-- a person acquires an interest in shares which, when taken
together with the shares in which persons acting in concert with it
are interested, increases the percentage of shares carrying voting
rights in which it is interested to 30 per cent. or more; or
-- a person, together with persons acting in concert with it, is
interested in shares which in the aggregate carry not less than 30
per cent. of the voting rights of a company but does not hold
shares carrying more than 50 per cent. of such voting rights and
such person, or any person acting in concert with it, acquires an
interest in any other shares which increases the percentage of
shares carrying voting rights in which it is interested.
Brief details of the Panel, and of the protections afforded to
Shareholders by the Takeover Code (which will cease to apply
following the Cancellation and Re-registration), will be set out in
the Circular.
Process for Cancellation
Under the AIM Rules, it is a requirement that the Cancellation
must be approved by Shareholders holding not less than 75 per cent.
of votes cast by Shareholders at the General Meeting. Accordingly,
the Notice of General Meeting set out in the Circular contains a
special resolution to approve the Cancellation.
Furthermore, Rule 41 of the AIM Rules requires any AIM company
that wishes the London Stock Exchange to cancel the admission of
its shares to trading on AIM to notify shareholders and to
separately inform the London Stock Exchange of its preferred
cancellation date at least 20 Business Days prior to such date. In
accordance with AIM Rule 41, the Directors have notified the London
Stock Exchange of the Company's intention, subject to the
Cancellation Resolution being passed at the General Meeting, to
cancel the Company's admission of the Ordinary Shares to trading on
AIM on 8 September 2022. Accordingly, if the Cancellation
Resolution is passed, the Cancellation will become effective at
7.00 a.m. on 8 September 2022. If the Cancellation becomes
effective, Singer Capital Markets will cease to be nominated
adviser of the Company and the Company will no longer be required
to comply with the AIM Rules.
Recommendation
The Directors consider that the Cancellation and the
Re-registration and adoption of the New Articles are in the best
interests of the Company and its Shareholders as a whole and,
therefore, unanimously recommend that you vote in favour of the
Resolutions at the General Meeting as Remy Millott, Kevin McNair,
Rupert Savage and Richard King (being the Directors who are
interested in Ordinary Shares) intend to vote, or procure the vote,
in respect of, in aggregate, 6,187,844 Ordinary Shares to which
they are beneficially entitled.
APPENDIX II
EXPECTED TIMETABLE OF PRINCIPAL EVENTS
Event Time and/or date (1)(2)
Notice provided to the London 2 August 2022
Stock Exchange to notify it
of the proposed Cancellation
Publication and posting of the 3 August 2022
Circular
Latest time for receipt of proxy 10:30 a.m. on 26 August 2022
appointments in respect of the
General Meeting
General Meeting 10.30 a.m. on 31 August 2022
Last day of dealings in Ordinary 7 September 2022
Shares on AIM
Cancellation 7.00 a.m. on 8 September 2022
Re-registration as a private week commencing 12 September
company 2022
Notes:
(1) All of the times referred to in this announcement refer
to London time, unless otherwise stated.
(2) Each of the times and dates in the above timetable is
subject to change. If any of the above times and/or dates
change, the revised times and dates will be notified to Shareholders
by an announcement through a Regulatory Information Service.
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