TIDMHVN
RNS Number : 1653H
Harvey Nash Group PLC
05 June 2017
5 June 2017
Harvey Nash Group plc
(HVN.L)
Proposed cancellation of Ordinary Shares from the Official List,
Admission to trading on AIM and Notice of General Meeting
As previously announced in Harvey Nash Group plc's ("Harvey
Nash" or the "Company") preliminary results on 27 April 2017, the
Board is proposing to cancel admission of the Company's Ordinary
Shares to the premium segment of the Official List and to trading
on the London Stock Exchange's Main Market for listed securities
("Cancellation") and apply for the admission of the Company's
Ordinary Shares to trading on AIM ("Admission"). A circular to
Shareholders (the "Circular") is expected to be posted later today
containing details of the proposed Cancellation and Admission.
Under the Listing Rules, the Cancellation requires the prior
approval of a resolution (the "Resolution") by Shareholders in
General Meeting, passed by not less than 75 per cent. of those
Shareholders who vote in person or by proxy. If approved by
Shareholders, it is anticipated that the effective date of the
Cancellation and Admission will be 28 July 2017, being not less
than 20 business days from the passing of the Resolution.
The Circular contains a notice convening a General Meeting of
Shareholders to be held at the offices of Travers Smith LLP at 10
Snow Hill, London, EC1A 2AL on 29 June 2017 at 10.00 a.m at which
the Resolution will be proposed as special resolution to approve
the Cancellation and Admission.
The Circular will be made available shortly on the Company's
website at www.harveynash.com/group/investors/ and will be
submitted to the National Storage Mechanism where it will shortly
be available to view at www.morningstar.co.uk/uk/nsm.
For further information please contact:
Harvey Nash Group plc Tel: 020 7333
2635
Albert Ellis, CEO
Mark Garratt, CFO
Panmure Gordon (UK) Limited Tel: 020 7886
2500
Ben Thorne / Andrew Potts / Peter
Steel (Corporate Finance)
Erik Anderson (Corporate Broking)
Hudson Sandler Tel: 020 7796
4133
Hattie O'Reilly
Fern Duncan
Unless otherwise stated, capitalised terms in this announcement
have the same meaning as in the Circular.
Appendix 1 - Expected timetable of key events
Publication of this document 5 June 2017
Latest time and date for receipt 10.00 a.m.
of Forms of Proxy 27 June 2017
Time and date of General Meeting 10.00 a.m.
29 June 2017
Last day of dealings in the 27 July 2017
Ordinary Shares on the Main
Market
Cancellation of the listing 8.00 a.m. 28
of the Ordinary Shares from July 2017
the Official List effective
Admission of Ordinary Shares 8.00 a.m. 28
to trading on AIM effective July2017
Appendix 2 - Extracts from the Circular
Background to and reasons for Cancellation and Admission
As announced in the Company's preliminary results statement on
27 April 2017, the Executive Directors recently completed a
comprehensive long-term strategic review in response to the range
of political and economic challenges internationally and the
changing information technology landscape as they impact Harvey
Nash's main operations, being the provision of executive search,
professional recruitment, software development, outsourcing and
business process solutions services. This has resulted in a clear
plan to develop the business and grow shareholder value by
increasing the Company's focus on technology staffing and by
investment in selected geographies through both organic and
acquisitive means.
The Board believes, in this regard, that AIM will provide an
environment more suited to the Group's current size and strategic
intent to enhance shareholder value by organic growth and
acquisitive activity. The Group's administrative and regulatory
requirements will be simplified following Admission and enable the
Group to execute strategic acquisitions more efficiently.
The Board believes that a transfer to AIM has the benefit of
lower transactional costs, lower ongoing costs and simpler
administration and regulatory requirements more appropriate to a
company of Harvey Nash's size, which will facilitate implementation
of the Company's plans for the next stage of its growth and will
enable the strategy to be executed in a more efficient manner.
In particular, the Board believes that a transfer to AIM will
offer greater flexibility to supplement organic growth with
complementary acquisitions since, as described in further detail in
the Circular, larger corporate transactions can be executed more
quickly and cost effectively compared with the regulatory
requirements of companies with shares listed on the premium segment
of the Official List such as Harvey Nash. The Board believes that
this is likely to be of benefit to the Company and Shareholders
going forward.
AIM, which is operated and regulated by the London Stock
Exchange, has an established reputation with investors and analysts
and is an internationally recognised market. It was launched in
June 1995 as the London Stock Exchange's market specifically
designed for smaller companies, with a more flexible regulatory
regime.
If the Cancellation is approved by Shareholders, the Board
intends to operate the Company's business, including its reporting
and governance, in substantially the same manner and with the same
objectives as at present. Thus, the Board sees the Company as being
attractive to specialist institutional investors while the AIM tax
regime, referred to in more detail below, will also make the
Company potentially attractive to AIM specific funds as well as to
retail investors.
For these reasons, the Board considers that it is in the
Company's interests to seek approval to effect the Cancellation.
However, Shareholders should note that following the Cancellation
becoming effective:
-- The regulatory regime which applies solely to companies such
as Harvey Nash with shares admitted to the premium segment of the
Official List and to trading on the London Stock Exchange's Main
Market for listed securities will no longer apply, including the
requirement for shareholder approval under the Listing Rules to
approve transactions above a certain size not in the ordinary
course of business or with related parties. Further details
regarding certain aspects of the regulatory regime that would no
longer apply to such transactions are provided in the Circular.
-- The Cancellation might have either positive or negative
taxation consequences for Shareholders. Since 5 August 2013, shares
traded on AIM can be held in ISAs and, with effect from 28 April
2014, stamp duty and stamp duty reserve tax (SDRT) on transfers of
shares listed on AIM has been abolished. Individuals who hold
Ordinary Shares following Admission may, after two years, also be
eligible for certain inheritance tax benefits. Further details on
taxation consequences are provided in the Circular.
-- The Cancellation may have implications for Shareholders
holding Ordinary Shares in a Self-Invested Personal Pension (SIPP).
For example, shares in unlisted companies may not qualify for
certain SIPPs under the terms of that SIPP and, if in any doubt,
Shareholders should consult with their SIPP provider immediately.
Following Admission, the Company will be categorised as
unlisted.
Details of the Cancellation and Admission
Conditional upon the Resolution being approved at the General
Meeting, the Company will apply to (i) cancel the listing of the
Ordinary Shares on the Official List and their admission to trading
on the London Stock Exchange's Main Market for listed securities;
and (ii) the London Stock Exchange for the admission of the
Ordinary Shares to trading on AIM. It is anticipated that the last
day of dealings of the Ordinary Shares on the Main Market will be
27 July 2017. Cancellation of the listing of the Ordinary Shares on
the Official List is expected to take effect at 8.00 a.m. on 28
July 2017, being not less than 20 Business Days from the passing of
the Resolution.
Admission is expected to take place and dealings in Ordinary
Shares are expected to commence on AIM at 8.00 a.m. on 28 July
2017.
As the Company's Ordinary Shares have been listed on the
Official List for more than 18 months, the AIM Rules do not require
an admission document to be published by the Company in connection
with Admission. However, subject to the passing of the Resolution
at the General Meeting, the Company will publish an announcement
which complies with the requirements of Schedule One to the AIM
Rules, comprising information required to be disclosed by companies
transferring their securities from the Official List, as an AIM
Designated Market, to AIM.
Following Cancellation and Admission, Ordinary Shares that are
held in uncertificated form will continue to be held and dealt
through CREST. Share certificates representing those Ordinary
Shares held in certificated form will continue to be valid and no
new Ordinary Share certificates will be issued.
In accordance with the Listing Rules, the Resolution is subject
to approval being obtained from not less than 75 per cent. of all
Shareholders voting in person or by proxy. If the requisite
percentage of Shareholders does not approve the Resolution, the
Ordinary Shares will not be admitted to AIM and will continue to be
admitted to the premium segment of the Official List and to trading
on the Main Market for listed securities of the London Stock
Exchange.
Implications of the transfer to AIM
Following Admission, the Company will be subject to the
regulatory and disciplinary controls of the AIM Rules. AIM is a
market designed primarily for emerging or smaller companies to
which a higher investment risk tends to be attached than to larger
or more established companies. Shareholders should note that the
protections afforded to investors in AIM companies are less
rigorous than those afforded to investors in companies such as
Harvey Nash listed on the premium segment of the Official List.
Under the AIM Rules, a Nominated Adviser and broker is required to
be engaged by the Company at all times and a Nominated Adviser has
ongoing responsibilities to both the Company and to the London
Stock Exchange. Conditional on Admission, the Company has appointed
Panmure Gordon as its Nominated Adviser and broker. The obligations
of a company whose shares are traded on AIM are broadly similar to
those of companies such as Harvey Nash whose shares are listed on
the premium segment of the Official List, however there are certain
exceptions, including those referred to in the Circular.
Outlook and current trading
The following was included in the Company's final results
announcement on 27 April 2017 in relation to outlook and current
trading:
"With 80% of the Group's clients, services and skills in the
technology and digital sector the Group is now well positioned for
growth.
We have a clear strategy to grow the business and our vision is
to be Europe's market leading technology and digital talent
provider with challenger businesses in the US and Asia.
During the year management took actions to streamline the
business, the benefits of which should be realised in the coming
year.
Our plan for growing the business and increasing shareholder
value is by capitalising on our strong market positions and
investing in selected geographies through both organic and
acquisitive means.
We have a strong balance sheet, a dedicated and skilled
management team and the growth in the use of technology is set to
continue. Despite market uncertainties, the Group is well
positioned with a clear strategy that underpins future growth. With
the benefits from the actions taken, we are confident of driving
profitable growth in the year to January 2018, whilst remaining
flexible in response to changes in market conditions. The current
financial year has started well, with performance marginally ahead
of expectations."
For the avoidance of doubt, the statement "confident of driving
profitable growth" was made in reference to the Group's strategy to
seek to secure further revenues that the Group will target to
deliver positive gross profit. This statement should not be
considered to be a forecast of an increase in the profit before tax
for the year ending 31 January 2018.
Recommendation
The Board considers the terms of the Proposal to be in the best
interests of the Company and its Shareholders as a whole.
Accordingly, the Board recommends that you vote in favour of the
Resolution to be proposed at the General Meeting, as the Directors
intend to do in respect of their own beneficial holdings amounting,
in aggregate, to 1,113,107 Ordinary Shares and representing
approximately 1.5 per cent. of the Company's issued share
capital.
This information is provided by RNS
The company news service from the London Stock Exchange
END
MSCFELFBDQFXBBL
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