Benchmark Holdings plc, the Sheffield headquartered aquaculture biotechnology firm, is planning to delist from the AIM stock market in London and Euronext Growth Oslo index to save costs.
The plans are subject to approval by shareholders and by Euronext Oslo.
Benchmark announced proposals for the return of the vast majority of proceeds from the disposal of its genetics business to shareholders, the cancellation of its shares on the two indexes, and the proposed re-registration of the company as a private limited firm.
The firm said that the cost, management resource and regulatory burden associated with maintaining the listings on AIM and Euronext Oslo Growth “outweigh the benefits of retaining such public quotations.”
Benchmark said: “In light of the persistent and sustained low liquidity in the company’s tightly held ordinary shares, as well as the high costs involved in maintaining the admissions to trading on two exchanges relative to the size of the residual group and its remaining operations, the board has carefully considered and evaluated over an extensive period of time the benefits and drawbacks to the vompany of retaining the admissions to trading of its ordinary shares on both AIM and Euronext Growth Oslo.
“The board has now concluded that the drawbacks outweigh the benefits such that the De-Listings are in the best interests of the company and its shareholders as a whole.”
Benchmark added: “The company realised gross cash proceeds of approximately £194 million from its disposal of the Genetics Business, excluding any contingent deferred consideration from the related earn out.
“The Company has utilised part of these proceeds to repay its green bond, revolving credit facilities and associated hedging instruments which in total amounted to approximately £87 million.
“After making these payments and settling transaction costs in respect of the Genetics Disposal, the Company currently has available net cash reserves of £117 million which includes the net proceeds of the Genetics disposal alongside cash resources to satisfy the working capital needs of the Remaining Business.
“Following due assessment of various options by the Board and consultation with the Company’s major shareholders, the Company now intends to return the vast majority of the net proceeds from the disposal of the Genetics Business to Shareholders which amount to £95 million through a combination of the Tender Offer and a planned special dividend following implementation of the De-Listings, whilst retaining an appropriate level of working and development/growth capital for the Group’s residual operating businesses and implementation of management’s existing near to medium term business plan.
“In addition, the Board is of the view that the cost, management resource and regulatory burden associated with maintaining the admissions to trading of the Company’s Ordinary Shares on AIM and Euronext Oslo Growth outweigh the benefits of retaining such public quotations, particularly in light of the reduced scale and specialist nature of the residual Group’s operations …
“In addition, adjusting each of the Tender Offer Price of 25 pence per share and the Company’s closing middle-market price of 22.0 pence per share on the Latest Practicable Date for the Company’s existing cash resources of £117 million (or 15.8 pence per share), the Tender Offer Price represents an 48.33 per cent. premium to the ex-cash equity value of the Company …”