The Board has announced plans to delist from the London Stock Exchange’s AIM and convert into a private limited company, seeking shareholders’ approval for this significant transition. A General Meeting is set for April 25, 2025, where shareholders will vote on this proposal, with the cancellation expected to take effect on May 6, if approved by a minimum of 75% of votes cast.
The decision to consider cancellation comes amid prolonged subdued trading, unfavorable market conditions, and an insistence to focus on growth through mergers and acquisitions. The evaluations have highlighted that despite the potential acquisition opportunities, the company’s market capitalization has not reflected the intrinsic value of its assets, making strategic partnerships difficult. The fluctuating share price and diminished liquidity have discouraged potential partners, limiting the company’s options for mergers or acquisitions. With low market valuation, even smaller transactions would require offering significant equity, which could be detrimental to existing shareholders.
Moreover, the Board has recognized that staying listed on AIM has yielded minimal advantages for shareholders. Transitioning to a private entity could facilitate more agile strategic moves and timely responses to emerging market opportunities, particularly in a fast-evolving sector where innovation and rapid consolidation are crucial.
Cost management is another substantial consideration. Continuing listings on AIM involves high legal, regulatory, and professional fees that overshadow potential benefits. The complexity and expenses associated with international compliance create a financial burden that detracts from operational efficiency and product development. Additionally, considerable management resources are swallowed by compliance obligations at the expense of strategizing for growth.
Accessing finance represents a further challenge under current conditions. The company’s share price and liquidity issues on AIM render it difficult to engage institutional investors in any significant or complex ventures. Transitioning to a private company could carve pathways to diverse funding sources, including private equity, without the valuation and liquidity pressures tied to public markets.
Understanding the transition may evoke uncertainty among shareholders, the management pledges to uphold transparency and engagement throughout the process. It is proposed to launch a Matched Bargain Facility through an external partner that would facilitate trading of shares for an interim period post-cancellation. Furthermore, a new shareholder portal will be made available, serving as a centralized source for ongoing updates, frequently asked questions, and crucial reports, ensuring shareholders remain informed and connected.
The Board has expressed its commitment to the long-term success of the company while reinforcing the importance of shareholder engagement during this change. Assurances have been made regarding open communication channels and ongoing access to management even after the transition. The leadership aims to maintain clarity and support as it navigates this journey towards becoming a private entity, emphasizing the shared vision and collaborative goal of achieving success for all stakeholders involved.