TIDMGEL
RNS Number : 8117Y
Greka Engineering & Technology Ltd
20 May 2016
20 May 2016
Greka Engineering & Technology Ltd
("Greka Engineering" or the "Company")
Proposed Delisting and EGM
Introduction
Further to the Company's announcement of its final results on 28
April 2016, in which it mentioned that it was considering whether
the costs of maintaining its listing on AIM were justified by the
benefits the listing brings, Greka Engineering now announces its
intention to seek Shareholder approval for the cancellation of the
admission of the Ordinary Shares to trading on AIM. The Board is
proposing a resolution to approve the Delisting at an EGM to be
held at 10.00 a.m. on 7 June 2016.
Reasons for the Delisting
The Directors have concluded that, for the reasons set out
below, the costs of maintaining the Company's admission to AIM are
not justified by the benefits gained from maintaining
admission:
-- the Ordinary Shares suffer from a lack of meaningful
liquidity and their overall price performance since admission to
AIM in September 2013 has been poor; and
-- the ongoing costs associated with maintaining the listing on
AIM are high relative to the Company's market capitalisation and
there is a significant administrative and regulatory burden
involved in admission to AIM.
Accordingly, the Board has concluded that it is no longer in the
interests of the Company or its Shareholders as a whole for the
Ordinary Shares to remain traded on AIM.
Principal effects of Delisting
The principal effects that the Delisting will have on
Shareholders include the following:
-- there will no longer be a formal market mechanism enabling
Shareholders to trade their Ordinary Shares on AIM (or any other
recognised market or trading exchange);
-- while the Ordinary Shares will remain freely transferable,
they may be more difficult to sell compared to shares of companies
traded on AIM (or any other recognised market or trading
exchange);
-- it may be more difficult for Shareholders to determine the
market value of their investment in the Company at any given
time;
-- the Company will no longer be subject to the AIM Rules and,
accordingly, Shareholders will no longer be afforded the
protections given by the AIM Rules - in particular, the Company
will not be bound to: make any public announcements of material
events, or to announce interim or final results; comply with any of
the corporate governance practices applicable to AIM companies;
announce substantial transactions and related party transactions;
or comply with the requirement to obtain shareholder approval for
reverse takeovers and fundamental changes in the Company's
business;
-- the Company will cease to retain a nominated adviser and broker; and
-- the Delisting might have either positive or negative taxation
consequences for Shareholders (Shareholders who are in any doubt
about their tax position should consult their own professional
independent adviser immediately).
Notwithstanding the Delisting, the Company will continue to
comply with the applicable statutory requirements and the Company's
articles of association.
The Board intends to continue to maintain the Company's website
(www.grekaengineering.com) and to post updates on that website from
time to time, although Shareholders should be aware that there will
be no obligation on the Company to include the information required
under AIM Rule 26 or to update the website as required by the AIM
Rules. In addition, Shareholders are reminded that as the Company
is registered in the Cayman Islands, Shareholders are not afforded
the protections provided by the City Code on Takeovers and
Mergers.
Process for Delisting
The Delisting is conditional on the approval of not less than 75
per cent. of votes cast by Shareholders (in person or by proxy) on
the resolution regarding the Delisting to be proposed at the
EGM.
Furthermore, Rule 41 of the AIM Rules requires an AIM company
that wishes the London Stock Exchange to cancel the admission of
its shares to trading on AIM to notify such intended cancellation
and 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 AIM of the
Company's intention, subject to the resolution being passed at the
EGM, to cancel the Company's admission of the Ordinary Shares to
trading on AIM. Accordingly, if the resolution is passed at the
EGM, the Delisting will become effective at 7.00 a.m. on 21 June
2016.
The Directors consider that the Delisting is in the best
interests of the Company and its Shareholders as a whole.
Accordingly, the Directors unanimously recommend Shareholders to
vote in favour of the resolution to be proposed at the EGM as they
intend to do in respect of their own beneficial holdings amounting
to 312,125,606 Ordinary Shares (representing 76.2% of the Company's
issued share capital).
Transactions in Ordinary Shares
Shareholders should note that, if effected, the Delisting will
significantly reduce the liquidity and marketability of the
Ordinary Shares. The Directors do not intend to provide, seek or
support any arrangements whereby Ordinary Shares can be bought or
sold on a matched bargain basis following the Delisting becoming
effective. Accordingly, interests in Ordinary Shares are unlikely
to be readily capable of sale and, where a buyer is identified, it
will be difficult to place a fair value on any such sale.
GDGH Ltd., the Company's parent company, recognises that many
Shareholders will not be able or willing to continue to own shares
in the Company following Delisting. Therefore, an affiliate of GDGH
Ltd. is making arrangements for Charles Stanley & Co. Limited
(Paul Brotherhood 0207 033 4900) as broker to acquire (subject to
the normal AIM close period rules) any Ordinary Shares which are
available in the market until Delisting (up to a maximum number of
97,496,527, being those Ordinary Shares not owned by GDGH Ltd. or
Randeep Grewal) at a price per Ordinary Share of 0.8p; this
represents a premium of 28 per cent. to the closing price of the
Ordinary Shares on AIM on 18 May 2016.
Circular
A circular containing the notice convening the EGM will be sent
to shareholders shortly and will also be available (together with
the Company's annual report and accounts for the year ended 31
December 2015) on the Company's website at
www.grekaengineering.com.
Contacts:
Greka Engineering
Betty Cheung, Director Corporate Affairs +852 3710 0088
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Smith & Williamson
Nominated Adviser & Broker
Dr Azhic Basirov / David Jones / Ben Jeynes +44 20 7131 4000
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For more information on Greka Engineering, please visit the
Company's website at: www.grekaengineering.com.
DEFINITIONS
"AIM" the market of that name
operated by the London
Stock Exchange
"AIM Rules" the AIM Rules for Companies
published by the London
Stock Exchange from time
to time
"Board" or "Directors" the Directors of the Company
"Company" or "Greka Engineering" Greka Engineering & Technology
Ltd.
"Delisting" the proposed cancellation
of admission of the Ordinary
Shares to trading on AIM
as described in this announcement
"Depository" Capita IRG Trustee Limited
"Depository Interests" the depository interests
or "DIs" issued by the Depository
in respect of and representing
on a one-for-one basis
Ordinary Shares held by
the Depository
"EGM" the extraordinary general
meeting of Greka Engineering
which is due to be held
on 7 June 2016, or any
reconvened meeting following
any adjournment thereof
"London Stock Exchange" London Stock Exchange
plc
"Ordinary Shares" the ordinary shares of
US$0.00001 each in the
capital of the Company
and (if the context so
requires) Depository Interests
"Shareholders" holders of Ordinary Shares
and (if the context so
requires) Depository Interests
representing Ordinary
Shares
This information is provided by RNS
The company news service from the London Stock Exchange
END
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