TLT Tolent

 

TIDMTLT 
 
RNS Number : 6015F 
Tolent PLC 
15 January 2010 
 

 
Tolent plc 
15 January 2010 
 
 
PROPOSED CANCELLATION OF ADMISSION TO TRADING ON AIM AND NOTICE OF GENERAL 
MEETING 
 
 
Tolent plc, the AIM listed construction group, announces its intention to 
convene a General Meeting to be held on 8 February 2010 for the purpose of 
seeking shareholder approval for the cancellation of its trading on AIM. 
 
 
An explanatory circular ('Circular') setting out the details of the proposal 
together with a notice of General Meeting, has been posted to shareholders 
today. 
 
 
Extracts of the text of the Chairman's letter contained within the Circular are 
set out below. Definitions in this announcement shall bear the same meaning as 
those in the Circular to Shareholders. 
 
 
 
 
Reason for the Cancellation of Admission 
 
 
The perceived benefits of an AIM listing usually include access to funding, 
enhanced corporate profile and liquidity in the company's shares. The Board has 
reached the view that the Company is not receiving these benefits to any extent 
that would justify the costs and management time associated with maintaining the 
listing. Furthermore, the requirements to provide trading updates under the AIM 
Rules are proving commercially disadvantageous in the current climate.The 
Board therefore believes that the Company's interests would be better served if 
the Company were to operate as an unlisted company without the requirements of 
an AIM listing. 
The Company has been listed on AIM since its demerger from Amco Corporation Plc 
(now called Billington Holdings Plc) in 1999. At no time since joining AIM has 
the Company sought to raise money from the markets, nor is it likely to attempt 
to do so.  Furthermore, if it were to attempt a significant capital raising by 
way of a share issue, the Board does not believe it would be successful in the 
current economic climate. 
The Board considers that corporate profile as a public company can create a 
perception of a more substantial business adding credibility with customers and 
potential customers.  However, the Company's competitors are often either very 
large public companies or private companies. Large public companies are able to 
carry out their activities through a number of different trading operations such 
that announcements and disclosures of results for the public company as a whole 
might not reveal the true performance of the business of any particular 
subsidiary in its group.  Private companies only have the requirement to produce 
accounts annually, which can help them to delay customers becoming aware of any 
deterioration in their performance, for example.  However, Tolent is more 
transparent owing to its relatively small size and AIM listing with its 
requirement for regular trading updates and, in the current climate, where 
activity levels are low, it is not difficult for customers to identify the 
impact that their contract is having on the Company's results and to use that to 
their commercial advantage. 
Volatility in the share price and the apparent discount or premium to the 
Group's net assets from time to time can also create a misleading view of the 
Company. Tolent's management find that considerable effort is often required to 
address the perceptions created with customers and suppliers before they will 
deal with the Company and the Board considers that Cancellation will remove this 
factor from discussions with customers and suppliers. 
In addition, Cancellation will result in savings in management time and costs 
associated with meeting the AIM Rules and related regulatory 
requirements including reporting, disclosure and corporate governance 
requirements. 
 
 
Trading in the Ordinary Shares is already very limited and demand for the 
Ordinary Shares from investors is low, as demonstrated by the share price 
performance over the past three years. The Board acknowledges that Cancellation 
will make it more difficult to trade in the Ordinary Shares but does not believe 
that this outweighs the commercial benefits to be gained in de-listing from AIM. 
However, it is important that Shareholders can trade in the Ordinary Shares and 
the Company is making arrangements for a matched bargain trading facility to be 
made available through Brewin Dolphin, further details of which are given at 
section 4 below. 
 
 
Following careful consideration, the Directors have therefore concluded that it 
is no longer in the best interests of the Company or its Shareholders to 
maintain the Company's admission to trading on AIM of the Ordinary Shares and 
consider that the direct costs and commercial disadvantages of remaining listed 
on AIM far outweigh the potential benefits.  The Board has therefore decided to 
propose the Cancellation.  The Directors' intention is that the Company should 
remain a public but unlisted company. 
 
Effect of the Cancellation on Shareholders 
The principal effects of the Cancellation would be that: 
 
 
(a)    there would no longer be a formal market mechanism enabling the 
Shareholders to trade their Ordinary Shares on AIM or any other market or 
trading exchange; 
 
 
(b)    the Company would not be bound to announce material events, 
administrative changes or material transactions nor to announce interim or final 
results; 
 
 
(c)    the Company would no longer be required to comply with any of the 
additional specific corporate governance requirements for companies admitted to 
trading on AIM; and 
 
 
(d)    the Company will no longer be subject to the AIM Rules and Shareholders 
will no longer be required to vote on certain matters as provided in the AIM 
Rules. 
 
 
In addition, the Cancellation 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. 
 
 
The Board will, however, continue to: 
 
 
(a)post information relating to the Company on its website at www.Tolent.co.uk; 
 
 
(b)    continue to hold general meetings in accordance with the applicable 
statutory requirements and the Company's articles of association; and 
 
 
(c)continue to provide access to and/or provide copies of the Company's audited 
accounts in line with the recently adopted electronic communications policy and 
in accordance with the applicable statutory requirements and the methods agreed 
with each Shareholder. 
 
 
Shareholders should note that following the Cancellation the Company will remain 
subject to the provisions of The City Code on Takeovers and Mergers on the basis 
set out in those provisions. 
 
 
The Company's CREST trading facility will remain in place for so long as it 
remains economic to do so. 
 
 
Share dealing following the Cancellation 
 
 
Whilst the Board believes that the Cancellation is in the interests of 
Shareholders as a whole, it recognises that Cancellation 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 Brewin Dolphin, 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 Brewin Dolphin 
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, Brewin Dolphin will contact both parties to 
effect the bargain. Shareholders who do not have their own broker may need to 
register with Brewin Dolphin 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.tolent.co.uk. 
 
Approving the Cancellation and General Meeting 
 
 
Under the AIM Rules, it is a requirement that the Cancellation must be approved 
by not less than 75 per cent. of the Shareholders voting in the General Meeting. 
  Accordingly, the notice of General Meeting to be held at 11 a.m. on 8 February 
2010 at the offices of the Company set out at the end of this document contains 
a special resolution to approve the application to the London Stock Exchange for 
the Cancellation. 
 
 
If the Resolution is approved, it is expected that the Cancellation will take 
effect at 7.00 a.m. on 16 February 2010 being at least 20 business days 
following the date of this letter and 5 clear business days following the date 
of the General Meeting. 
 
Letters of intent 
 
 
The Company has received letters of intent from Gutenga Investments PCC Limited, 
Gutenga Holdings Limited (Trustee of the Tolent Employee Share Ownership Trust) 
and Tarom Foundation in respect of the 9,421,318 Ordinary Shares held by them, 
representing 73.4 per cent. in aggregate of the issued share capital of the 
Company confirming their intention to vote in favour of the Resolution. 
 
Action to be taken by Shareholders 
 
 
A Form of Proxy for use by Shareholders in connection with the General Meeting 
accompanies this document. Whether or not you intend to be present at the 
General Meeting, you are requested to complete and sign the Form of Proxy and 
return it to the Company Secretary at Ravensworth House, 5th Avenue Business 
Park, Team Valley, Gateshead, Tyne & Wear, NE11 0HF, so as to be received no 
later than 11.00 a.m. on 4 February 2010. 
 
 
Unless the Form of Proxy is received by the date and time mentioned in the 
instructions, it will be invalid. The completion and return of the Form of Proxy 
will not prevent you from attending the General Meeting and voting in person, if 
you so wish. 
 
Recommendation 
 
 
The Directors consider the Resolution to be in the best interests of the Company 
and Shareholders as a whole and consider that it is most likely to promote the 
success of the Company for the benefit of Shareholders as a whole. The Directors 
therefore unanimously recommend Shareholders to vote in favour of the Resolution 
at the General Meeting, as they intend to do in respect of their own beneficial 
holdings of 63,000 Ordinary Shares representing 0.5 per cent. of the issued 
share capital of the Company at the date of this document. 
 
 
 
 
For further information, please contact: 
 
 
Tolent plc                                    0191 487 0505 
Peter Hems, Chairman 
John Woods, Chief Executive Officer 
Andy Clark, Finance Director 
 
 
Brewin Dolphin Investment Banking    0845 270 8610 
Andrew Emmott 
 
 
 
 
ENDS 
 
This information is provided by RNS 
            The company news service from the London Stock Exchange 
   END 
 
 MSCEAPFLFLPEEFF 
 

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