TIDMKEN
RNS Number : 3541Y
Kenetics Group Limited
22 December 2010
22 December 2010
Kenetics Group Limited
("Kenetics" or "the Company")
Proposed Cancellation of Admission to Trading on AIM
Kenetics, the Radio Frequency Identification ("RFID") group
focussed on security and RFID systems and products, today announces
that it is seeking Shareholder approval for the cancellation of
admission to trading on AIM of its Ordinary Shares.
Introduction
Kenetics' ordinary shares were admitted to trading on AIM on 18
August 2006 and for some time now the Board has been concerned that
trading in the Company's shares has become progressively more
limited. The reasons for the limited trading in Kenetics' shares,
and those of many other small cap companies, have been widely
discussed in the press and elsewhere.
The Board believes that the Company's share price does not
reflect the value of the underlying business and that the Company
is prevented from raising the funds required to develop its current
and planned activities. As a result, the Board now announces its
intention to seek the authority of Shareholders to obtain a
cancellation of the Company's Ordinary Shares from trading on
AIM.
A General Meeting has been convened at the offices of Stephenson
Harwood One St. Paul's Churchyard, London, EC4M 8SH for 8.30 a.m.
on 18 January 2011, at which Shareholders will be asked to
consider, and if thought fit, to approve a Resolution in order to
implement the Delisting.
Rationale for the Delisting
The Directors have concluded that a resolution should be put to
Shareholders to approve a Delisting for the following reasons:
-- there is a clear lack of liquidity in the Ordinary Shares of
the Company which, in the Directors' view, has contributed to the
Company being undervalued on AIM;
-- the bid/offer spread at which a market is made in the
Company's Ordinary Shares has perpetuated the lack of liquidity and
the Directors believe this is unlikely to be resolved, given the
size of the Company and its lack of appeal to institutional
investors;
-- the ability to secure new equity participation at levels
which fairly reflect the existing equity value is significantly
undermined by the low share price at a time when the Company has a
pressing need to raise funds; and
-- the costs associated with maintaining a listing on AIM are
now disproportionate to value provided by the listing, and
management expects savings arising from the Delisting will amount
to approximately GBP125,000 per annum.
Progress since admission to AIM
The Company has made significant progress since being admitted
to trading on AIM in August 2006. A new range of GEN2 products have
been developed and improvements have been made to its existing
industrial product range, including the Ultra High Frequency (UHF)
RFID readers. These products are currently being sold in the USA,
Europe and Japan.
In addition to continuing to enhance its UHF technology platform
and developing a new generation of RFID products, in early 2008 the
Company began investing in the development of Advanced Fare
Collection (AFC) technologies. Strategically, Kenetics has
identified a growing market towards automation in the public mass
transport sector, particularly through the use of AFC in rail and
bus systems. Since 2009, Kenetics has focused mainly on developing
Contactless Smart Card (CSC) readers and On Board Bus Equipment
(OBE), which form the backbone for entry into the AFC systems
market. Since it first began to invest in the development of AFC
technologies, the Company has made significant progress in its
R&D efforts and has developed what the Directors believe to be
some technologically advanced innovations for the rail and bus
systems.
The development work for the CSC readers and the OBE systems is
now completed and both are currently undergoing commercial trials
in both the rail and bus systems under two contracts for the
Singapore Land Transport Authority (LTA).
Board deliberations
Against this background, the Board, some of whom are also major
Shareholders, has spent significant time evaluating different
strategic alternatives for the Company. These deliberations have
taken into account the current financial position of the Company,
the Company's growth strategy, the current financial climate and
the relative benefits compared to the ongoing costs of maintaining
a listing on AIM. The Board has also taken into account the views
of the Company's large shareholders, as well as assessing the
position of the Company's shareholders as a whole.
Following careful consideration of these factors with its
advisers, the Board has decided that the disadvantages and the
ongoing costs of maintaining a listing on AIM far outweigh the
benefits that the listing on AIM provides to the Company
Irrevocable Undertakings
Each Director who holds Ordinary Shares and certain other
significant Shareholders have confirmed to the Company that they
will be voting in favour of the Resolution in respect of the
Ordinary Shares held by them. The total number of Ordinary Shares
covered by these irrevocable undertakings is 32,215,480 Ordinary
Shares representing 78.86 per cent. of the Company's issued share
capital.
Future Opportunity
The Board's objective is to realise an exit for Shareholders
within a three to five year period following cancellation of it
Ordinary Shares from trading on AIM. The Board will consider all
forms of exit for its Shareholders, including a trade sale, private
equity buyout or public market listing with the aim to maximize
Shareholder value.
Share dealing following the Delisting
Whilst the Board believes that the Delisting is in the interests
of Shareholders as a whole, it recognises that Delisting will make
it more difficult for Shareholders to buy and sell Ordinary Shares
should they so wish. Accordingly, the Board intends to set up a
matched bargain arrangement, provided by SVS Securities, to enable
Shareholders to trade the Ordinary Shares. Under this facility, it
is intended that Shareholders or persons wishing to trade Ordinary
Shares will be able to leave an indication with SVS Securities that
they are prepared to buy or sell at an agreed price. In the event
that the matched bargain settlement facility is able to match that
indication with an opposite sell or buy instruction, SVS Securities
will contact both parties to effect the bargain. Shareholders who
do not have their own broker may need to register with SVS
Securities as a new client. This can take some time to process and
therefore Shareholders who consider they are likely to use this
facility are encouraged to commence it at the earliest opportunity.
Once the facility has been arranged, details will be made available
to Shareholders on the Company's website at
www.kenetics-group.com.
Recommendation
The Directors believe that the cancellation from admission to
AIM is in the best interests of Shareholders as a whole. The
Directors therefore unanimously recommend that Shareholders vote in
favour of the Resolution as they intend to do in respect of their
own interests in 27,410,575 Ordinary Shares in aggregate,
representing approximately 67.10 per cent. of the Ordinary Shares
currently in issue.
Circular
A circular is today being posted to Shareholders with a Notice
of General Meeting to approve the Delisting and is available on the
Company's website www.kenetics-group.com.
For further information, please
contact:
Ken Wong, Chairman and CEO Dominique Doussot
Kenetics Group Limited ZAI Corporate Finance
Tel: +65 6749 0083 (Nominated Advisor)
Website:www.kenetics-group.com Tel: +44 207 060 1760
Alex Mattey / Ian Callaway Jeremy Carey / Andrew Dunn
SVS Securities Tavistock Communications
(Broker)
Tel: +44 207 638 5600 Tel: +44 207 920 3150
EXPECTED TIMETABLE OF PRINCIPAL EVENTS
Announcement of cancellation of admission 22 December 2011
to AIM
Latest time and date for receipt of Forms 8.30 a.m. on 17 January
of Proxy for the General Meeting 2011
General Meeting of Kenetics Group Ltd 8.30 a.m. on 18 January
2011
Cancellation of the admission to trading 28 January 2011
on AIM of the Ordinary Shares
DEFINITIONS
The following definitions apply throughout the document unless
the context requires otherwise:
"1985 Act" the Companies Act 1985 (as amended)
"2006 Act" the Companies Act 2006
"Act" the 1985 Act and the 2006 Act
"Admission" the admission of the Ordinary
Shares to trading on AIM in accordance
with the AIM Rules
"AIM" the market of that name, operated
by the London Stock Exchange
plc
"AIM Rules" the AIM Rules for Companies published
by the London Stock Exchange
plc from time to time
"Board" or "Directors" the directors of the Company,
whose names appear on page 3
of this document
"Business Day" any day, other than a Saturday,
Sunday or UK Bank Holiday
"Company" or "Kenetics" Kenetics Group Ltd
"CREST" the computer based system for
the transfer of uncertificated
securities operated by Euroclear
"Delisting" the proposed cancellation of
Admission
"Euroclear" Euroclear UK and Ireland Limited
"Form of Proxy" the form of proxy accompanying
this document for use by Shareholders
at the General Meeting
"General Meeting" the general meeting of the Company
to be held at the offices of
Stephenson Harwood, One St. Paul's
Churchyard, London, EC4M 8SH
at 10.00 a.m. on [18] January
2011 (notice of which is set
out at the end of this document)
"Notice" the notice of the General Meeting
which is set out at the end of
this document
"Ordinary Shares" the ordinary shares of 1p each
in the share capital of the Company
"Registrars" Computershare Investor Services
(Jersey) Limited of Queensway
House, Hilgrove Street, St Helier,
Jersey JE1 1ES
"Resolution" the resolution to be proposed
at the General Meeting, as set
out in the Notice
"Restricted Jurisdictions" the United States, Canada, Australia,
New Zealand, South Africa or
Japan or any other jurisdiction
where the mailing of this document
into such jurisdiction would
constitute a violation of the
laws of such jurisdiction
"Shareholders" holders of Ordinary Shares and
the term "Shareholder" shall
mean any one of them
"United Kingdom" or "UK" the United Kingdom of Great Britain
and Northern Ireland
This information is provided by RNS
The company news service from the London Stock Exchange
END
MSCFEDFSFFSSELE
Kendrick Resources (LSE:KEN)
Historical Stock Chart
From Jun 2024 to Jul 2024
Kendrick Resources (LSE:KEN)
Historical Stock Chart
From Jul 2023 to Jul 2024
