TIDMIMSG
Date: 23 January 2009
On behalf of: International Marketing & Sales Group Limited ("IMSG" or "the Company")
International Marketing & Sales Group Limited
-- Notice of adjourned EGM to Seek Approval for Proposed Delisting
from AIM
-- Continuation of listing on Swedish AktieTorget Market
-- Resignation of Directors
International Marketing & Sales Group Limited (AIM / AktieTorget: IMSG), ("IMSG" or "the Company") the emerging markets focused sales and marketing company, announces that its extraordinary general meeting ("EGM") originally convened for 11.00am on 15 January 2009, will be held at 11.00am on 16 February, 2009 at 47 Esplanade, St Helier, Jersey, JE1 0BD.
The purpose of the adjourned meeting is to seek approval from the shareholders of the Company (the "Shareholders") for the cancellation of the admission of the Company's ordinary fully paid shares (the "Shares") to trading on the AIM market of the London Stock Exchange plc ("AIM") (the "Cancellation").
Having now had an opportunity to consider the views expressed by the Company's major shareholders in response to the notice of EGM dated 23 December, 2008, the board of directors of the Company (the "Board") has concluded that it will be in the best interests of the Company and the Shareholders for the Company to proceed with the cancellation of the admission of its securities to trading on AIM, but to maintain the admission of the Shares to the Swedish AktieTorget market ("AktieTorget").
Under AIM Rule 41, cancellation of the admission to AIM requires the consent of not less than 75% of votes cast by shareholders in a general meeting.
The background to the Board's decision to recommend delisting the shares of the Company from AIM was set out in the circular to shareholders dated 23 December, 2008 and in the announcement made on 30 December, 2008. In summary, the principal reasons for delisting are:
the heavy fall in the Company's share price over the past 12 months, which has severely curtailed the usefulness of the Company's shares as a currency for acquisitions;
the lack of liquidity in the Company's shares;
the disproportionate amount of management time required to maintain listings in London and Stockholm when compared to the benefits which those listings are providing (and are likely to provide in the foreseeable future) for Shareholders; and
the overriding need to reduce the Company's operating costs, overheads and future financial commitments wherever possible.
It is in this context that the Board is now seeking to reduce the cost to the Company of maintaining a public trading facility for its shares.
The proposed AIM de-listing is one of the steps the Board is taking to improve the Company's current and future financial position.
Other steps include a substantial reduction in central management costs, which is to be achieved by reducing the size of the central management team and through reductions in the remuneration paid to management.
In this connection, the Company has agreed in principle with Michael Green and Dr Daniel Thorniley that they will resign as directors of the Company (and, in Mr Green's case, as an employee) with effect on and from 31 January, 2009.
Also, as announced on 13 January, 2009, the Board is currently engaged in ongoing discussions with the sellers of shares in 8 of the 16 companies acquired over the past 3 years in order to re-negotiate the terms of the share purchase, including in particular the Company's forward commitments under contractual earn-out arrangements.
The process of re-negotiating the remaining earn-out arrangements is in some cases putting the relationship between the Company and the sellers of shares in recently acquired companies under significant stress.
In most cases, the individuals concerned continue to be closely involved in the management of the subsidiary companies and as a result the Company is experiencing some delays and complications in relation to the payment to the Company of dividends and management fees due from its recently acquired subsidiaries. The Board is actively addressing these matters. However, in the meantime, these circumstances are placing additional pressure on the Company's cash flow and so increasing the importance of reducing operating costs wherever possible.
In these circumstances, and after careful consideration of the views expressed by major shareholders since the proposed delisting was announced, the Board has decided that, while it would be in the best interests of shareholders to maintain the admission to AktieTorget so as to retain a facility for the Company's Shares to be publicly traded, the Company and the Shareholders would benefit from the increased flexibility, cost savings and improved management efficiency that would result from de-listing from AIM.
Therefore the Board now seeks shareholder approval to cancel the AIM listing in accordance with AIM Rule 41, on the basis that the AktieTorget listing will be maintained for the time being.
Any future decision to de-list from AktieTorget would be put to the Shareholders in general meeting and the Board would not proceed with such a de-listing without the approval of a majority of votes cast at such meeting.
Accordingly, the adjourned General Meeting originally convened for 15 January, 2009, will be held at 11.00am on 16 February, 2009 to consider and, if thought fit, approve the cancellation of the Company's AIM admission with effect on and from 27 February 2009, with trading in the Company's shares on AIM to cease at close of business on 26 February, 2009.
IMSG will remain a public company and there will be no dilution or other change in shareholdings as a result of the proposed de-listing from AIM.
The Company will continue to comply with the AktieTorget rules from time to time in force, including the issue to Shareholders annually of a report and audited accounts, as well as quarterly interim statements. In addition, the Company will maintain its website along the lines of AIM Rule 26, keeping shareholders as fully informed as possible.
In the event that shareholders resolve to cancel the admission of the Company's shares to trading on AIM, trading in the Company's Shares will continue on AktieTorget. In order to transfer their IMSG Shares from AIM to AktieTorget, Shareholders may open an account with a Swedish bank or broker so that the Shares can be registered with the Swedish Central Securities Depository ("VPC"). Individual Shareholders may open a VPC account themselves or with the assistance of their bank or broker. Alternatively, it may be possible for Shares to be held on AktieTorget by a VPC nominee on behalf of Shareholders. The former shareholders of ONE Media AB (now an IMSG subsidiary) have such an arrangement with Euroclear/VPC and the Company is currently in discussions with Euroclear/VPC with a view to making such custodian arrangements available to all Shareholders.
The transfer of IMSG Shares held in the CREST system will be carried out by each Shareholder's broker or bank with the assistance of the Company's registrars. Shares held in certificated form may be transferred to AktieTorget by forwarding the relevant share certificate(s) to the Shareholder's Swedish bank or broker or (in the event that nominee account arrangements are able to be put in place) to Euroclear/VPC. A further announcement will be made if and when new nominee arrangements for IMSG Shareholders are put in place with Euroclear/VPC.
Once Shares have been transferred to AktieTorget, transactions in the Shares will be executed on behalf of shareholders by their Swedish bank/broker or (as the case may be) by Euroclear/VPC as the custodian of those Shares.
If the Resolution is passed at the Meeting, further information concerning the arrangements for transferring shares from AIM to AktieTorget and for subsequent dealings in shares on AktieTorget will be communicated to shareholders as soon as practicable thereafter.
The Board confirms that, if the resolution described above is passed by shareholders: audited accounts of the Company will continue to be sent to shareholders not later than 6 months after the end of each financial period; shareholders will continue to be provided with quarterly financial information in substantively the same form as currently required under AIM and IFRS rules; subject to the cash flow requirements of the Company, at least 50% of the available profits of the Company shall be distributed by way of dividend; and the Board will continue to explore opportunities to realise value for shareholders, including a sale of the Company to, or a merger with, a third party and the Board shall consider seeking re-admission of the shares of the Company to trading on AIM or on an EU regulated public market as and when global and regional economic conditions are more favourable.
The Notice of the adjourned EGM will be posted to Shareholders this week, and a copy of the Notice and accompanying circular explaining the arrangements in more detail will be available at the Company's website shortly at: http://www.imsg.co.uk
For Further Information, please contact:
Terry Livingstone
International Marketing & Sales Group Limited Tel: + 44 20 7735 6788
www.imsg.co.uk
Andrew Best / Emily Bruning
Shared Value Limited Tel: +44 (0) 20 7321 5010
www.sharedvalue.net
Johanna Fagrell Kohler Tel: +46 (0) 8 588 341 00
ONE Media Holding AB
Mark Williams / Henry Fitzgerald-O'Connor
Canaccord Adams Limited Tel: +44 (0)20 7050 6500
Notes to Editors
-- IMSG was founded in 1996 and the Group was admitted to trading on AIM
on 6 December 2005. IMSG is also listed on AktieTorget in Sweden.
-- The Group's clients include multinational and first tier local
companies operating in FMCG, telecommunications, retail trade, banking
and finance, automotive, consumer electronics and pharmaceutical
industries.
-- Further information about the Group is available on its website at: http://www.imsg.co.uk
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