Cruisequeen18 May 2010 13:09
RNS Number : 0840M CDS Oil & Gas Group PLC 18 May 2010
CDS Oil and Gas Group plc - "CDS" or the "Company"
Update and Proposed cancellation of admission of Ordinary Shares to AIM
On 29 September 2009, it was announced that CDS's Principal Shareholders (being Feltown Assets Inc., Werton Finance S.A. and Red Law Corporation Services Inc.) had agreed to continue to support the financial needs of the Company as it sought partners to assist with the funding of the Company's exploration activities. Since then, the Company has been in discussions with a number of prospective investors that have not yet resulted in funding being available. Whilst the Company believes that these discussions will, at some stage, reach a satisfactory conclusion, negotiations are still ongoing and the Company remains dependent upon the Principal Shareholders for financial support in the form of loans to the Company.
The board of directors of CDS (the "Board") is of the opinion that CDS's financial situation is not appropriate for an AIM quoted company. Accordingly, the Board wishes to announce its intention to apply for the cancellation of admission to trading on AIM of the ordinary shares of the Company, subject to shareholder approval at a general meeting. It is anticipated that the effective date of the cancellation will be 23 June 2010 following the general meeting to be held on or around 15 June 2010.
Rationale for the Cancellation
In arriving at this decision, the Board has considered: (1) the only source of funding currently available to the Company are loans provided by the Principal Shareholders; (2) the significant ongoing costs associated with maintaining a quotation on AIM; (3) the relative inactivity, in ordinary share trading volume terms, of the Company's shares due largely to the absence of a significant free float; and (4) the removal of the ongoing obligations and costs associated with the Company's continued compliance with the AIM Rules for Companies.
The cancellation will result in the Company significantly reducing its administrative costs. Accordingly, the Board unanimously believes that it is in the best interests of the shareholders to seek cancellation at the earliest opportunity.
The Board has received undertakings to vote in favour of the resolution to be proposed at the general meeting to effect the cancellation from shareholders holding shares representing, in aggregate, 71.28 per cent. of the issued share capital of the Company.
Effect of Cancellation
Following cancellation, the Ordinary Shares will not be quoted on any publicly quoted market in the UK or elsewhere. Should the cancellation be approved, the Company intends to act in an appropriate manner befitting a company that no longer trades through a public market.
The principal effects of cancellation will be:
· there will no longer be a formal market mechanism enabling the shareholders to trade their shares throu
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