TIDMGTS
RNS Number : 7036C
GTS Chemical Holdings PLC
29 June 2016
29 June 2016
GTS Chemical Holdings plc
("GTS" or the "Company" or the "Group")
Proposed Cancellation of Admission
GTS Chemical Holdings plc (AIM: GTS), the specialty chemicals
and lubricating oil producer, and China's largest producer of
ammonium sulfite, announces proposals to cancel the Admission of
the Company's shares to trading on AIM.
The Annual General Meeting to consider the proposals will be
held at 11.00 a.m. (UK time) on 25 July 2016 at 4th Floor, Prince
Frederick House, 35-39 Maddox Street, London, W1S 2PP.
Further details, including definitions, are set out below.
Enquiries:
GTS Chemical Holdings plc
Mr Roy Su, CFO Tel: +86 159 5935 8899
Website www.gtschemical.com
SP Angel Corporate Finance Tel: +44 (0) 20 3470 0470
LLP
Nominated Adviser and Broker
David Facey / Stuart Gledhill
Introduction
The Company announces it is proposing to seek Shareholders'
consent to cancel the admission of the Company's Ordinary Shares to
trading on AIM.
In addition to the Delisting, the Notice of AGM will include the
ordinary business to be dealt with at the Company's annual general
meeting.
The Delisting
Reasons for the Delisting
The Directors have undertaken a review of the merits or
otherwise of the Company continuing to be admitted to trading on
AIM. The Directors have concluded that a proposal to cancel the
Admission should be made to Shareholders at the Annual General
Meeting. In reaching the decision to propose this to Shareholders,
the Directors have taken the following factors into account: -
-- The primary purpose of the Company's Admission was the
opportunity it provided to raise capital in support of the
Company's growth prospects. Given current market conditions, and in
particular the lack of investors for businesses operating in the
PRC, the Directors are of the opinion that it is difficult for the
Company to attract any or meaningful equity investment through its
listing on AIM and accordingly the Directors will be assessing
potential alternatives to raise growth capital.
-- There are significant professional fees and other costs
associated with the maintaining of the Company's AIM listing.
In the Board's opinion the costs of Admission outweigh any
benefits that currently accrue to the Company or its Shareholders
and the Admission should therefore be cancelled as it is no longer
in the best interests of the Shareholders as a whole.
Effects of Delisting
The principal effects of the Delisting would be that: -
-- there would no longer be a formal market mechanism enabling
Shareholders to trade their shares on AIM or any other market or
trading exchange;
-- the Company would not be bound to announce material events,
such as interim or final results, material transactions or
administrative changes;
-- the Company would no longer be bound to comply with the
corporate governance requirements for companies with shares
admitted to trading on AIM;
-- the Company would no longer be required to comply with the
AIM Rules (or to have a nominated advisor), and Shareholders would
no longer be required to vote on certain matters prescribed by the
AIM Rules; and
-- interim reports will not be sent to Shareholders and, as a
result, Shareholders will only receive the annual report once a
year;.
It is intended that the Company will not withdraw from CREST so
that Ordinary Shares can still be held or transferred in
Uncertified Form until SinoEuro Runtai's proposed offer to the
Investors as set out below completes.
Following the Delisting, although the Ordinary Shares will
remain transferable, they will no longer be tradable on AIM.
Consequently, it is likely to be more difficult for a Shareholder
to purchase or sell any Ordinary Shares following the Delisting.
Following the Delisting, transfers of Ordinary Shares may be
effected in accordance with those provisions of the Articles
concerning off-market transfers of shares.
SinoEuro Runtai, the majority shareholder of the Company,
proposes to make an offer to all Investors to purchase their
Ordinary Shares at the Offer Price following the Delisting. Further
details are set out below.
Delisting procedure
The Board has accordingly concluded that it is in the best
interests of Shareholders as a whole that the Delisting be
approved.
Under the AIM Rules, the Delisting can only be effected by the
Company after securing a special resolution of Shareholders in a
general meeting, whereby at least 75 per cent. of votes cast are in
favour of such a resolution. A period of at least five Business
Days following the Shareholder approval of the Delisting is
required before the Delisting may be put into effect.
Resolution 7 contained in the Notice of AGM seeks Shareholder
approval for the Delisting. The Company has received irrevocable
undertakings from Shareholders holding 90,777,778 Ordinary Shares,
representing approximately 88.73 per cent. of the current voting
rights in the Company, to vote in favour of the Delisting. Assuming
that Shareholders approve this resolution, it is proposed that the
Delisting will take place by 2 August 2016 at the earliest.
Takeover Code
The Takeover Code is issued and administered by the Takeover
Panel. The Takeover Code currently applies to the Company and will
continue to apply to the Company notwithstanding the Delisting. The
Takeover Code will cease only to apply to the Company on the expiry
of the 10-year period from the date of the Delisting or, if
earlier, the date on which the Company is dissolved.
The Takeover Code and the Takeover Panel operate principally to
ensure that shareholders are treated fairly and are not denied an
opportunity to decide on the merits of a takeover and that
shareholders of the same class are afforded equivalent treatment by
an offeror. The Takeover Code also provides an orderly framework
within which takeovers are conducted. In addition, it is designed
to promote, in conjunction with other regulatory regimes, the
integrity of the financial markets
The Takeover Code is based upon a number of General Principles
which are essentially statements of standards of commercial
behaviour. General Principle One states that all holders of
securities of an offeree company of the same class must be afforded
equivalent treatment and if a person acquires control of a company,
the other holders of securities must be protected. This is
reinforced by Rule 9 of the Takeover Code which requires a person,
together with persons acting in concert with him, who acquires
shares carrying voting rights which amount to 30 per cent. or more
of the voting rights to make a general offer. A general offer will
also be required where a person who, together with persons acting
in concert with him, holds not less than 30 per cent. but not more
than 50 per cent. of the voting rights, acquires additional shares
which increase his percentage of the voting rights. Unless the
Takeover Panel consents, the offer must be made to all other
shareholders, be in cash (or have a cash alternative) and cannot be
conditional on anything other than the securing of acceptances
which will result in the offeror and persons acting in concert with
him holding shares carrying more than 50 per cent. of the voting
rights.
Proposed Offer to the Investors after the Delisting
At the Record Date, SinoEuro Runtai which is beneficially owned
by Mr Cheng Liu held 78,057,556 Ordinary Shares representing 76.29
per cent. of the entire issued share capital of the Company.
SinoEuro Runtai proposes to offer to purchase the Ordinary Shares
from the Investors at the Offer Price following the Delisting.
SinoEuro Runtai is expected to send an offer letter to the
Investors within a period of 30 days after the Delisting.
As SinoEuro Runtai holds more than 50 per cent. of the entire
issued share capital of the Company, the increase of its percentage
of voting rights in the Company by purchasing the Ordinary Shares
from the Investors in the proposed offer will not trigger the
requirement for SinoEuro Runtai to make a mandatory offer in
accordance with Rule 9 of the City Code.
In addition, assuming all Investors accept the offer and sell
all of the Ordinary Shares held by them to SinoEuro Runtai,
SinoEuro Runtai would hold 83,157,275 Ordinary Shares representing
81.28 per cent. of the entire issued share capital of the Company
after such purchases. It would not trigger the squeeze-out and
sell-out rules relating to the Ordinary Shares under the City Code
nor would it constitute a "takeover offer" under the Jersey
Companies Law.
For the avoidance of doubt, this proposed offer is not an offer
made by the Company to purchase the Ordinary Shares. It is an offer
made by SinoEuro Runtai, an existing Shareholder. In addition,
nothing in this announcement is a recommendation made by the
Company or the Board to accept any such proposed offer.
The Board following Delisting and Corporate Governance
It is intended that Mr Andrew Harding, Mr David Weir, Mr Derek
Welch and Mr Zhi (George) Zeng will resign as Directors of the
Company on the date of Delisting and hence the Board will comprise
Mr Cheng Liu, Mr Xinlin (Roy) Su and Ms Xueying Zhang immediately
following Delisting.
However, the Directors intend to continue to operate the Company
for the benefit of all Shareholders. They also intend to continue
to keep Shareholders informed of progress and remain committed to
high standards of corporate governance. As such, the Directors
will:-
- post items of news on the Company's website (www.gtschemical.com);
- hold annual general meetings and general meetings in
accordance with statutory requirements and the Articles; and
- continue to send to Shareholders copies of the Company's audited accounts each year.
Annual General Meeting
Set out at the end of the Circular is a notice convening the AGM
of the Company to be held at 11.00 a.m. (UK time) on 25 July 2016
at 4(th) Floor, Prince Frederick House, 35-39 Maddox Street,
London, W1S 2PP. At this AGM, the Resolutions will be proposed.
Irrevocable Undertakings
The Company has received irrevocable undertakings from SinoEuro
Runtai, Earnest Faith, Yu Peng, Cosmic Dawn and Vantage Link to
vote in favour of the Resolutions. These undertakings represent
88.73 per cent. of the voting rights in the Company.
Recommendation
The Directors consider that all the Resolutions to be considered
at the AGM, including the Delisting, are fair and reasonable and
are in the best interests of the Company and the Shareholders as a
whole. The Directors therefore unanimously recommend that
shareholders vote in favour of the Resolutions.
Full Year Account and Dividend
Given the proposed Delisting, the Directors no longer intend to
propose a dividend for the year ended 31 December 2015. The full
year accounts are due to be published today.
Resolution
The full text of the Resolution is set out in the Notice of
AGM.
Expected Timetable of Principal Events
Publication of the Circular 29 June 2016
Latest time and date for receipt 11.00 a.m. on 23
of Form of Proxy July 2016
Annual General Meeting 11.00 a.m. on 25
July 2016
Announcements of results of 25 July 2016
AGM
Expected last day of dealings 1 August 2016
in Ordinary Shares on AIM
Expected time and date that with effect from
the admission to trading of 7.00 a.m.
the Ordinary Shares on AIM on 2 August 2016
will be cancelled
If any of the above times and/or dates change, the revised times
and/or dates will be notified to Shareholders by announcement
through a Regulatory Information Service of the London Stock
Exchange.
Definitions
The following definitions apply throughout this announcement,
unless the context requires otherwise:
"Admission" the admission of the Ordinary
Shares to trading on AIM;
"AIM" the market of that name
operated by the London Stock
Exchange;
"AIM Rules" the AIM Rules for Companies
published by the London
Stock Exchange from time
to time;
"Annual General the annual general meeting
Meeting" or "AGM" of the Company convened
for 11.00 a.m. (UK time)
on 25 July 2016 and any
adjournment thereof;
"Articles" the memorandum and articles
of association of the Company
as at the date of this document;
"Business Day" a day (excluding Saturday,
Sunday and public holidays
in England and Wales) on
which banks are generally
open for business in London
for the transaction of normal
banking business;
"BVI" the British Virgin Islands;
"City Code" the City Code on Takeovers
and Mergers (as published
by the Panel);
"Company" GTS Chemical Holdings plc,
a company incorporated in
Jersey under the Jersey
Companies Law with registered
number 114810;
"Cosmic Dawn" Cosmic Dawn Limited, a company
incorporated in the BVI
with registered number 1823019;
"CREST" the relevant system (as
defined in the CREST Regulations)
in accordance with which
securities may be held or
transferred in uncertificated
form, and in respect of
which Euroclear UK and Ireland
is the Operator (as defined
in the CREST Regulations);
"CREST Regulations" the UK Uncertificated Securities
Regulations 2001 (SI 2001/3755)
and the Companies Uncertificated
Securities, (Jersey) Order
1999 as amended from time
to time, and any applicable
rules made under those regulations;
"Delisting" the cancellation of admission
to trading on AIM of the
Ordinary Shares;
"Directors" or "Board" the board of directors of
the Company;
"Earnest Faith" Earnest Faith Group Limited,
a company incorporated in
the BVI with registered
number 1817431;
"Form of Proxy" the form of proxy enclosed
with the circular for use
at the Annual General Meeting
or at any adjournment thereof;
"Investors" all Shareholders who held
Ordinary Shares at the Record
Date save for Substantial
Holders;
"Jersey" Bailiwick of Jersey, a British
Crown Dependency;
"Jersey Companies the Companies (Jersey) Law
Law" 1991, as amended
"London Stock Exchange" London Stock Exchange plc;
"Notice of AGM" the notice of Annual General
Meeting which is set out
in the circular to be published
on 29 June 2016;
"Offer Price" 49.5 pence per Ordinary
Share, the closing mid price
on 28 June 2016, being the
last practicable Business
Day prior to the publication
of the Circular;
"Ordinary Shares" the ordinary shares of GBP0.01
each in the capital of the
Company, and "Ordinary Share"
means any one of them;
"Panel" or "Takeover the UK Panel on Takeovers
Panel" and Mergers;
"Record Date" 28 June 2016 being the last
practicable Business Day
prior to the publication
of the Circular;
"Resolutions" the resolutions to be proposed
at the Annual General Meeting
in the form set out in the
Notice of Annual General
Meeting;
"Shareholders" holders of Ordinary Shares
from time to time and "Shareholder"
means any one of them;
"SinoEuro Runtai" SinoEuro Runtai Environmental
Protection Resource Co.,
Ltd., a company incorporated
in the BVI with registered
number 1760994;
"SP Angel" SP Angel Corporate Finance
LLP, nominated adviser and
broker to the Company;
"Substantial Holders" any Shareholders who held
(whether legally or beneficially)
Ordinary Shares at the Record
Date that constitute in
aggregate more than 2% of
the entire issued share
capital of the Company at
the Record Date;
"UK" or "United the United Kingdom of Great
Kingdom" Britain and Northern Ireland;
"Uncertificated" a share or other security
or recorded on the relevant
"in Uncertificated register of the relevant
Form" company concerned as being
held in uncertificated form
in CREST and title to which,
by virtue of CREST Regulations,
may be transferred by means
of CREST;
"Vantage Link" Vantage Link Investments
Limited, a company incorporated
in the BVI with registered
number 1812635; and
"Yu Peng" Yu Peng Trading Limited,
a company incorporated in
the BVI with registered
number 1817433.
This information is provided by RNS
The company news service from the London Stock Exchange
END
MSCAKCDQPBKDQAB
(END) Dow Jones Newswires
June 29, 2016 11:47 ET (15:47 GMT)
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