TIDMSWG
RNS Number : 8017K
Shearwater Group PLC
02 September 2019
2 September 2019
SHEARWATER GROUP PLC
Proposed Share Capital Reorganisation
Notice of AGM and Posting of Annual Report
Shearwater Group plc (AIM: SWG, "Shearwater" or the "Company"),
today announces a proposed share capital reorganisation ("Capital
Reorganisation") of the existing ordinary share capital of the
Company.
The effect of the proposed Capital Reorganisation will be to
reduce the number of issued ordinary shares in the Company by a
factor of 100, which is expected to increase the trading price of
the resulting ordinary share proportionally and to increase the
ratio between the nominal value of an ordinary share and the
current trading price to a more normal level.
The Board considers the Capital Reorganisation to be in the best
interests of the Company and the shareholders of the Company
("Shareholders"). In particular, it believes the effect of the
Capital Reorganisation will improve the market liquidity of the
Company's ordinary shares by reducing the volatility and spread of
trading activity and make the Company's ordinary shares more
attractive to a broader range of institutional investors and other
members of the investing public, both within the UK and
overseas.
As it is proposed that all existing ordinary shares held in the
Company be consolidated, the proportion of the issued ordinary
share capital of the Company held by each Shareholder immediately
before and after the Capital Reorganisation will remain relatively
unchanged, other than for small changes that may arise from the
rounding for fractional entitlements.
Implementation of the Capital Reorganisation requires the
approval of Shareholders. This approval is being sought at the
Company's annual general meeting ("AGM"), which is scheduled to be
held at 11.00 a.m. on Wednesday 25 September 2019 at the offices of
Mayer Brown International LLP, 201 Bishopsgate, London EC2M 3AF at
which the resolution necessary to give effect to the Capital
Reorganisation will be put to Shareholders, alongside other
resolutions customarily put to Shareholders as part of the
Company's AGM process.
The notice of AGM, which provides details of the Capital
Reorganisation, and form of proxy, is today being sent to
Shareholders, along with the copies of the Annual Report and
Accounts for the year ended 31 March 2019. The notice of AGM and
Annual Report and Accounts are also being made available at the
Company's website, www.shearwatergroup.com.
Further details in relation to the Capital Reorganisation
As at the date of the AGM, the Company's issued ordinary share
capital will consist of 2,210,646,000 ordinary shares of 1 pence
each. This is a significant number of shares for a Company with a
market capitalisation of approximately GBP42.6 million as of 30
August 2019. The Board believes that the Capital Reorganisation is
necessary in order to increase the marketability of the Company's
Ordinary Shares through the creation of a higher price per Ordinary
Share and a more normal ratio between the market price and the
nominal value. The Board believes that the Capital Reorganisation
will result in a capital structure more conducive to attracting new
institutional investors based both in the UK and in other overseas
jurisdictions. The Board also believes that the Capital
Reorganisation will increase market liquidity of the Company's
shares by reducing the volatility and spread of the Company's
shares and make trading in the Company's shares more attractive to
a broader range of institutional investors and other members of the
investing public.
The Company's issued ordinary share capital currently consists
of 2,210,645,984 ordinary shares of 1 pence each. An additional 16
ordinary shares have been allotted and issued, subject to admission
of such ordinary shares to trading on AIM, for the purposes of
financing with the proceeds of such issue, the purchase by the
Company of the Deferred Shares (as defined below) which will be
created as a result of the Capital Reorganisation. Accordingly, on
the date of the AGM, the Company's issued ordinary share capital
will consist of 2,210,646,000 (a number that is easily divisible by
100) ("Existing Ordinary Shares").
The Capital Reorganisation will comprise two elements:
-- Consolidation - Every 100 Existing Ordinary Shares will be
consolidated into one ordinary share of GBP1 (a "Consolidated
Share").
-- Sub-division - Immediately following the consolidation, each
Consolidated Share will then be sub-divided into one new Ordinary
Share of 10 pence (a "New Ordinary Share") and one deferred share
of 90 pence (a "Deferred Share").
If the relevant resolution is passed, the Capital Reorganisation
will become effective at close of business on the day of the
AGM.
The Capital Reorganisation will give rise to fractional
entitlements to shares. Any new shares in respect of which there
are fractional entitlements will be aggregated and sold in the
market for the best price reasonably obtainable on behalf of
Shareholders entitled to fractions, save where the net proceeds of
sale amount to GBP5.00 or less, in which case the Company will not
distribute such proceeds of sale, which instead shall be retained
for the benefit of the Company. Given the current price of the
Existing Ordinary Shares, the Company does not anticipate that the
net proceeds of sale attributable to any Shareholder entitled to
fractions will be more than GBP5.00, and therefore it is expected
that there will be no distribution of any net proceeds of sale to
Shareholders.
If a Shareholder holds fewer than 100 Ordinary Shares as at the
Record Date, such that the rounding down process results in a
Shareholder being entitled to zero Consolidated Shares, then they
will cease to hold any New Ordinary Shares in the Company following
the completion of the Capital Reorganisation.
The New Ordinary Shares arising on implementation of the Capital
Reorganisation will have the same rights and benefits as the
Existing Ordinary Shares, including voting, dividend and other
rights. The Deferred Shares will not entitle holders to receive
notice of or attend and vote at any general meeting of the Company
or to receive a dividend or other distribution or to participate in
any return on capital on a winding up other than the nominal amount
paid on such shares following a substantial distribution to the
holders of ordinary shares in the Company.
Accordingly, the Deferred Shares will, for all practical
purposes, be valueless and it is the Board's intention that, at an
appropriate time, the Company may repurchase the Deferred Shares,
cancel or seek the surrender of the Deferred Shares using such
lawful means as the Board may at such time determine.
The following table shows the expected issued share capital of
the Company immediately prior to the AGM and following the AGM if
the Capital Reorganisation is approved:
Number of Number of issued Agreegate
issued ordinary Deferred Shares nominal value
shares of shares
in the Company
(GBP)
Immediately prior to
the AGM 2,210,646,000 0 22,106,460
Following close of business
on the date of the AGM 22,106,460 22,106,460 22,106,460
The Company intends to adjust awards under the Group's share
incentive plans accordingly to preserve the position of
participants.
Application will be made for the New Ordinary Shares to be
admitted to trading on AIM. Dealings in the Existing Ordinary
Shares will cease at close of business on the date of the AGM and
dealings in the New Ordinary Shares are expected to commence the
following day. The Deferred Shares will not be admitted to trading
on AIM.
The ISIN code for the New Ordinary Shares is GB00BKT6VH21 and
the SEDOL number is BKT6VH2.
Assuming that the necessary resolution to approve the Capital
Reorganisation is passed at the AGM, it is anticipated that CREST
accounts for Shareholders who hold their Existing Ordinary Shares
in uncertificated form will be credited with the New Ordinary
Shares to which they are entitled on 26 September 2019 or as soon
as practicable after the Capital Reorganisation becomes
effective.
The Company will issue new share certificates to those
Shareholders holding Existing Ordinary Shares in certificated form
to take account of the Capital Reorganisation. Following the issue
of new share certificates, share certificates in respect of
Existing Ordinary Shares will no longer be valid.
No share certificates will be issued for, and CREST accounts
will not be credited with, the Deferred Shares.
Expected timetable of principal events
Latest time and date for receipt 11.00 a.m. on 23 September
of Forms of Proxy 2019
Annual General Meeting 11.00 a.m. on 25 September
2019
Cessation of dealing in Existing Close of business on 25
Ordinary Shares September 2019
Record date for Capital Reorganisation Close of business on 25
September 2019
Admission and dealings in the New 8.00 a.m. on 26 September
Ordinary shares expected to commence 2019
on AIM
Expected date for New Ordinary Shares 8.00 a.m. on 26 September
to be credited to CREST accounts 2019
(where applicable)
Despatch of Share Certificates in Within 14 days of admission
respect of New Ordinary Shares to
non-CREST Shareholders
Enquiries:
Shearwater Group plc c/o Instinctif Partners
David Williams, Chairman
Phil Higgins, CEO
Cenkos Securities plc - NOMAD and
Joint Broker
Max Hartley / Giles Balleny - NOMAD
Julian Morse / Michael Johnson -
Sales +44 (0) 20 7397 8900
Berenberg - Joint Broker
Matthew Armitt / Mark Whitmore +44 (0) 20 3207 7800
Instinctif Partners shearwater@instinctif.com
Adrian Duffield / Chantal Woolcock +44 (0) 20 7457 2815
About Shearwater Group plc
Shearwater Group plc is an award-winning organisational
resilience group that provides cyber security and managed security
services to help assure and secure businesses in a connected global
economy.
The Group's comprehensive cyber security solutions and services
maintain trust between users, provide assurance around the
protection of information assets and critical infrastructure, and
support organisations' operational effectiveness. Its capabilities
include identity and access management and data security, cyber
security solutions and managed security services, and security
governance, risk and compliance.
The Group is headquartered in the UK with offices in the US, UK
and Europe, serving customers across the globe who are active in a
broad spectrum of industries.
Shearwater shares are listed on the London Stock Exchange's AIM
under the ticker "SWG". For more information, please visit
www.shearwatergroup.com.
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London Stock Exchange. RNS is approved by the Financial Conduct
Authority to act as a Primary Information Provider in the United
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of this information may apply. For further information, please
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END
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