Cancellation of Trading on AIM
08 Avril 2009 - 8:00AM
UK Regulatory
TIDMBLS
RNS Number : 3164Q
Block Shield Corporation PLC
08 April 2009
?
Block Shield Corporation plc
('Block Shield' or 'the Group')
Proposed cancellation of admission to trading on AIM of the Ordinary Shares
and
Notice of General Meeting
Block Shield, the provider of innovative, value-added RFID solutions, today
announces that it is proposing to cancel the admission to trading on AIM of its
Ordinary Shares. A circular (the "Circular") has been posted to shareholders
today convening a general meeting at which a resolution will be proposed to
approve the De-Listing.
REASONS FOR THE DE-LISTING
The Ordinary Shares were admitted to trading on AIM on 27 April 2004 following a
placing at a price of 72 pence per share giving the Company a market
capitalisation of approximately GBP18.2 million at admission. Since that time,
the Directors have sought to add to Shareholder value by developing the
Company's EMC and RFID product and equipment manufacturing capabilities. Due to
the weakening global economy, troubled financial markets and the current "credit
crunch", development has been slower than originally anticipated. Specifically,
the lack of capital equipment purchases and slower RFID industry ramp up has
resulted in little uptake of our manufacturing and equipment solutions. As a
result, the Company's share price has also suffered. As at close of business on
7 April 2009 (being the latest practicable date prior to the publication of the
Circular) the closing mid-market price of an Ordinary Share was 1.88 pence,
valuing the Company at approximately GBP1.43 million.
In recent months the Company has been drawing down on an "as-needed" basis from
the US$5 million credit facility which Cloverleaf Holdings, the Company's
largest shareholder, has provided and which, as announced on 9 March 2009, has
been extended until 31 December 2010. The Directors have taken advances from
this facility in the hope of funding the Group through to an appropriate time
when it may be in a position to undertake a new equity fundraising. Within this
period, the Directors have endeavoured to gauge the appetite for an additional
equity investment from the Company's largest Shareholders. However, due to
current difficult market conditions and the lack of revenue from RFID products,
such appetite does not exist at the present time.
The Company announced on 11 February 2009 that its technology licensee, Mu-Gahat
Enterprises LLC ("Mu-Gahat Enterprises"), had signed a conditional contract for
US$3 million for installations over 2 years, subject to completion of successful
test installations. This testing is now complete and the results are viewed by
both the customer and the Company as very positive. The customer has requested,
however, additional development work and refinements to the system before
declaring the contract unconditional and, at present, the customer and Mu-Gahat
Enterprises have been unable to agree the scope and terms of the additional work
required. Accordingly, there can be no certainty as to the revenue, if any,
which will be received by the Company through its licensing arrangements with
Mu-Gahat Enterprises by virtue of this contract.
In light of these difficult stock market conditions adversely affecting the
Company's immediate ability to raise new equity to finance appropriate growth
opportunities, the Directors have undertaken a review of the benefits of the
Ordinary Shares continuing to be traded on AIM. As a result of this review, the
Directors have identified the following key factors in their considerations:
-the limited stock market appreciation of the Company's projects;
-the inability to raise capital due to prevailing stock market conditions;
-the negative market sentiment for high risk technology start-ups;
-the concentration of the Company's shareholder base resulting in limited
trading liquidity in the
Ordinary Shares; and
-the costs and regulatory burdens associated with maintaining admission to AIM.
After careful deliberation, the Board has concluded, in the absence of an
ability to raise capital in the public market, that it is no longer in the best
interests of the Company or its Shareholders to maintain the admission of the
Ordinary Shares to trading on AIM.
THE DE-LISTING
In accordance with Rule 41 of the AIM Rules, the Company has today notified the
London Stock Exchange of the De-Listing, which is conditional upon the consent
of not less than 75 per cent. of votes cast by Shareholders in a general
meeting.
Consequently, the Company is convening the General Meeting for 11.00 a.m. on 24
April 2009. If the Resolution is passed at the General Meeting then the last day
of trading of the Company's Ordinary Shares will be 11 May 2009 and the
cancellation of admission to trading on AIM will be effective from 7.00 a.m. on
12 May 2009.
STRATEGY FOLLOWING DE-LISTING
Following the De-Listing, the Directors intend to continue to focus on enhancing
Shareholder value by advancing the Company's gaming business. The Company will
continue to pursue discussions with potential investors to secure financing to
sustain the Company at least on a "care and maintenance" basis in the near term.
However, Shareholders should be aware that if the Company is unable to procure
further funding, then the Board will be obliged to consider whether the Company
is in a position to continue trading.
The Company will endeavour to continue to provide a number of the same
facilities and services to Shareholders which are currently enjoyed as
shareholders of an AIM company, including maintenance of the current website,
keeping Shareholders as fully informed as possible.
Shareholders should note that following the De-Listing the central place of
management and control of the Company will remain outside the United Kingdom and
accordingly the protections offered by the City Code in Takeovers and Mergers
will, as is already the position, not apply to the Company.
TRANSACTIONS IN THE ORDINARY SHARES FOLLOWING DE-LISTING
Following the De-Listing, 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, holdings of Ordinary Shares are unlikely to be capable of sale and will be
difficult to value.
However, while there can be no guarantee of any Shareholders being able to
purchase or sell any Ordinary Shares, any Shareholder seeking to do so should
contact the Company Secretary in writing at the registered office of the Company
at One America Square, Crosswall, London EC3N 2SG.
IRREVOCABLE UNDERTAKINGS
The Company currently has in issue 76,086,926 Ordinary Shares. The Company has
received irrevocable undertakings and/or statements of intent to vote in favour
of the Resolution in respect of 44,305,824 Ordinary Shares representing 58.25
per cent. of the Ordinary Shares.
The irrevocable undertakings and/or statements of intent have been received from
the following Shareholders:
+---------------------+-----------------------+---------------------+
| Shareholder | Number of Ordinary | % of Existing |
| | Shares | Ordinary Shares |
+---------------------+-----------------------+---------------------+
| Directors | | |
+---------------------+-----------------------+---------------------+
| Gary Fairhead* | 714,345 | 0.94% |
+---------------------+-----------------------+---------------------+
| Richard Gadbois | 22,059 | 0.03% |
+---------------------+-----------------------+---------------------+
| Edwin Oh | 300,651 | 0.40% |
+---------------------+-----------------------+---------------------+
| Others | | |
+---------------------+-----------------------+---------------------+
| Bellini Group | 1,336,225 | 1.76% |
| Holdings | | |
+---------------------+-----------------------+---------------------+
| Cloverleaf | 17,098,989 | 22.47% |
| Holdings** | | |
+---------------------+-----------------------+---------------------+
| Falcon Group | 1,336,225 | 1.76% |
| Holdings | | |
+---------------------+-----------------------+---------------------+
| Highland Fund | 668,113 | 0.88% |
| Managers | | |
+---------------------+-----------------------+---------------------+
| Narawally | 7,319,179 | 9.62% |
| Investments | | |
+---------------------+-----------------------+---------------------+
| Talbot Investments | 14,864,184 | 19.54% |
+---------------------+-----------------------+---------------------+
| Baxter Watkins | 645,854 | 0.85% |
+---------------------+-----------------------+---------------------+
| Total | 44,305,824 | 58.25% |
+---------------------+-----------------------+---------------------+
| *706,992 Ordinary Shares are held through Hanover |
| Nominees Limited. |
| |
+-------------------------------------------------------------------+
| **1,503,255 Ordinary Shares are held in the name of |
| Cloverleaf Ventures LLC. David Whelan is deemed |
| interested in the shares held by Cloverleaf Ventures |
| LLC. |
+---------------------+-----------------------+---------------------+
GENERAL MEETING
The General Meeting is being convened which will be held at the offices of
Lawrence Graham LLP at 4 More London Riverside, SE1 2AU 11.00 a.m. on 24 April
2009 and at which a special resolution will be proposed to cancel the admission
of the Company's Ordinary Shares to trading on AIM.
RECOMMENDATION
The Directors consider the De-Listing to be in the best interests of the Company
and its Shareholders for the reasons explained above. Accordingly, the Directors
recommend you to vote in favour of the Resolution at the General Meeting as they
intend to do (where they are able to instruct voting) in respect of a total of
1,037,055 Ordinary Shares (representing approximately 1.36 per cent. of the
Existing Ordinary Shares).
THE CIRCULAR
The Circular has been posted to Shareholders today containing a Notice of
General Meeting at which a resolution will be proposed to approve the
De-Listing. The Circular will be available on the Company's website
(www.blockshield.com).
Enquiries:
+-----------------------------+------------------+--------------------------------+
| Block Shield Corporation | | |
| Plc | | |
+-----------------------------+------------------+--------------------------------+
| Edwin Oh, Chief Executive | +1 408 830 5100 | |
| Officer | | |
+-----------------------------+------------------+--------------------------------+
| | | |
+-----------------------------+------------------+--------------------------------+
| Ambrian Partners Limited | +44 20 7634 4700 | |
+-----------------------------+------------------+--------------------------------+
| Nominated Adviser | | |
+-----------------------------+------------------+--------------------------------+
| Samantha Harrison | | |
+-----------------------------+------------------+--------------------------------+
EXPECTED TIMETABLE OF PRINCIPAL EVENTS
+--------------------------------------------+----------------------------------+
| Publication date of the circular posted to | 8 April 2009 |
| shareholders | |
+--------------------------------------------+----------------------------------+
| Latest time and date for receipt of Forms | 11.00 a.m. on 22 April 2009 |
| of Proxy | |
+--------------------------------------------+----------------------------------+
| General Meeting | 11.00 a.m. on 24 April 2009 |
+--------------------------------------------+----------------------------------+
| Cancellation of admission of the Ordinary | with effect from 7.00 a.m. on 12 |
| Shares to trading on AIM | May 2009 |
+--------------------------------------------+----------------------------------+
DEFINITIONS
The following definitions apply throughout this announcement, unless the context
otherwise requires:
+---------------------------+---------------------------------------------------+
| "AIM" | AIM, the market operated by the London Stock |
| | Exchange |
+---------------------------+---------------------------------------------------+
| "AIM Rules" | the London Stock Exchange AIM Rules for Companies |
+---------------------------+---------------------------------------------------+
| "Block Shield" or | Block Shield Corporation Plc |
| "Company" | |
+---------------------------+---------------------------------------------------+
| "De-Listing" | the proposed cancellation of admission to AIM of |
| | the Ordinary Shares |
+---------------------------+---------------------------------------------------+
| "Cloverleaf Holdings" | Cloverleaf Holdings Limited |
+---------------------------+---------------------------------------------------+
| "Directors" or Board" | the board of directors of Block Shield |
+---------------------------+---------------------------------------------------+
| "EMC" | electromagnetic capability |
+---------------------------+---------------------------------------------------+
| "Existing Ordinary | the 76,086,926 Ordinary Shares in issue as at the |
| Shares" | date hereof |
+---------------------------+---------------------------------------------------+
| "Form of Proxy" | the form of proxy for use at the GM or at any |
| | adjournment of such meeting |
+---------------------------+---------------------------------------------------+
| "GM" or "General Meeting" | the general meeting of the Company convened for |
| | 11.00 a.m. on 24 April 2009 and any adjournment |
| | thereof |
+---------------------------+---------------------------------------------------+
| "Group" | the Company and its subsidiaries |
+---------------------------+---------------------------------------------------+
| "London Stock Exchange" | London Stock Exchange plc |
+---------------------------+---------------------------------------------------+
| "Notice of General | the notice of the General Meeting which is |
| Meeting" | incorporated into the Circular |
+---------------------------+---------------------------------------------------+
| "Ordinary Shares" | fully paid ordinary shares of 1 pence each in the |
| | capital of the Company |
+---------------------------+---------------------------------------------------+
| "Resolution" | the resolution referred to in the Notice of |
| | General Meeting |
+---------------------------+---------------------------------------------------+
| "RFID" | radio frequency identification |
+---------------------------+---------------------------------------------------+
| "Shareholders" | holders of Ordinary Shares |
+---------------------------+---------------------------------------------------+
-END-
This information is provided by RNS
The company news service from the London Stock Exchange
END
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