Last checked at 29 Jan 2009 07:00
29 January 2009 Silentpoint plc (Silentpoint, the `Company') Proposed cancellation of admission to trading on AIM
Silentpoint plc, (AIM: SLP), an investment company, announces that an application has been made today for the cancellation of admission to trading on AIM of its ordinary shares (the "Cancellation"), subject to the approval of the Company's shareholders. The Company will post a circular to its shareholders later today to convene a general meeting to be held on 20 February 2009 ('GM') in order to consider a special resolution to approve the Cancellation.
It is expected that, subject to shareholder approval at the GM, the Cancellation will take effect at 7.00 am on 27 February 2009.
Full details of the reasons behind the decision to propose the Cancellation to shareholders, including details of what action shareholders should take, are set out in the circular which has been posted to shareholders today.
In summary, the board of directors of the Company (the 'Directors') have been considering for some time the merits or otherwise of the Company's Ordinary Shares continuing to trade on AIM. The following factors were taken into account during their review:
* the current economic turmoil has led to major falls in the values of the global stock markets, from which Silentpoint is not immune. The Directors believe that the stock market operates on a short-term investment horizon which can have little basis in the underlying fundamentals of a business such as Silentpoint. The susceptibility of the share price to market conditions is not to the benefit of the business;. * Silentpoint, like most other small cap listed companies is unable to raise capital from institutional investors, as they appear to be uninterested in committing funds to companies in the small cap sector . The Directors do not expect this situation to change in the foreseeable future especially in the light of the present problems of the stock market; * the low liquidity of shares in Silentpoint leads to a volatility in the share price, which may not reflect the true worth of the business; * the costs, management time and regulatory burdens associated with maintaining an AIM listing compared to the resources available to the Company; * the ability of the Company as a listed company to react quickly to the requirements of the business and the market in which it trades is constrained by the reporting obligations set out in the AIM Rules; and * interest rates are at a record low and the Company is receiving a minimal level of interest income on its cash deposits. The Board's view is that interest rates are likely to remain at a low level for at least the next 12 months..
The Directors have therefore concluded that it is no longer in the best interests of the Company or its shareholders as a whole to maintain admission to trading on AIM of its Ordinary Shares.
If Shareholders wish to sell their Ordinary Shares on AIM before the Cancellation takes effect, they must do so prior to the Cancellation becoming effective, which is expected to be on 27 February 2009.
Shareholders should be aware that, if the resolution to approve the Cancellation is passed, there will be no facility to buy or sell Ordinary Shares on any exchange with effect from 27 February 2009.
Haresh Kanabar, Chairman of Silentpoint plc commented: 'The Board hasunanimously decided to recommend the Cancellation to the shareholders as wefeel that the current economic environment means there is little benefit toSilentpoint and its shareholders in its shares remaining listed. TheCancellation will reduce the Company's regulatory and reporting costssignificantly.`Silentpoint plc Smit Berry Tel: 020 8656 4648 Haresh Kanabar Tel: 020 7297 0010 John East & Partners Limited David Worlidge/Simon Clements Tel: 020 7628 2200
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