LONDON (Alliance News) - Shares in Atlas Development & Support Services Ltd were down 16% Tuesday, after it said it plans to liquidate its Kenyan subsidiaries and instead focus all of its attention on Ethiopia for the time being.
Atlas attributed the decision to the downturn in the oil and gas industry, market adjustment, the failure of some key clients to settle debts and increasing creditor pressure.
The company will instead focus its resources and management on its newly formed industrial division and new joint venture with Orchid Business Group PLC.
It will close its Kenyan subsidiaries, Ardan Logistics Kenya Ltd, Ardan (Medical Services ) Ltd and Ardan (Civil Engineering) Ltd, although it will maintain its listing on the GEM segment of the Nairobi Securities Exchange.
"Since the downturn in the oil and gas market, we have found that clients are no longer placing a premium on our high quality services and are demanding terms which are not economically viable. In addition to this, late payment by certain operators and increasing creditor pressure in Kenya necessitate and justify this shift at this time to serve the best interest of the long term development of the business and shareholders," said Chief Executive Carl Esprey in a statement.
Shares in Atlas were down 16% at 0.461 pence Tuesday morning.
By Hana Stewart-Smith; hanassmith@alliancenews.com; @HanaSSAllNews
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