Proposed Cancellation to Trading on AIM

 

TIDMMNA 
 
RNS Number : 0386R 
Monterrico Metals PLC 
23 April 2009 
 

 
 
MONTERRICO METALS PLC 
(Incorporated and registered in England & Wales under the Companies Act 1985 
with Registered Number 04236974) 
PROPOSED CANCELLATION OF ADMISSION OF ORDINARY SHARES TO TRADING ON AIM AND 
NOTICE OF ANNUAL GENERAL MEETING 
 
 
The Board of Monterrico Metals Plc ("Monterrico" or the "Company") announces 
that it intends to seek Shareholders' approval to cancel admission of its Shares 
(the "Shares") to trading on AIM. ("Proposed De-listing" or "Delisting"). 
 
 
The purpose of this announcement is to set out the background to and reasons for 
the Proposed De-listing. 
 
1.  Background to and reasons for the Proposed Delisting 
 
 
The Company was admitted to trading on AIM on 21 June 2002. On 12 April 2007, 
the cash offer made by Zijin Tongguan Investment Development Co. Ltd ("Zijin 
Tongguan") to acquire the entire issued and to be issued ordinary share capital 
of the Company became wholly unconditional with Zijin Tongguan holding 89.9 per 
cent of the issued and paid-up share capital of the Company. In September 2007, 
Zijin Tongguan placed approximately 10.0 per cent of the Company's issued shares 
to LS-Nikko Copper Inc. As at the date of this document, Zijin Tongguan and 
LS-Nikko Copper Inc. remain as the substantial shareholders of the Company 
holding 79.9 per cent and 10.0 per cent of the Company's issued and paid-up 
share capital respectively. 
 
 
The directors of the Company (the "Directors") believe that the ongoing costs 
and regulatory requirements of a quotation on AIM can no longer be justified, 
and that greater shareholder value may be derived by operating the Company 
off-market after taking into account the following factors:- 
 
 
-     the Company is not yet income generating as at the date of this document 
because, among other factors, the Company has yet to commence any exploitation 
activities pending the submission for approval of its environmental and social 
impact study for the project in Peru. On 9 February 2009, the Company entered 
into a further loan facility agreement of up to US$5 million with Zijin 
Tongguan, and the Company has also extended the term of the loans of US$5 
million and GBP2.55 million which expired on 2 February 2009 to 9 February 2010. 
The Directors are also currently in discussions with Zijin Tongguan to extend to 
term of the loans of up to GBP2 million and US$8 million due to expire on 30 
April 2009 and 3 July 2009 respectively. The Board expects the Company to 
continue relying on Zijin Tongguan's financial support and/or bank borrowings to 
meet its working capital requirements; 
-    lack of liquidity in the Shares as a result of the concentrated shareholder 
base. As noted above, Zijin Tongguan and LS Nikko Copper Inc. collectively hold 
89.9 per cent of the total issued share capital of the Company. These 
shareholders have confirmed to the Board that they are in favour of the Proposed 
De-listing and will vote in favour of the Proposed De-listing. 
 
 
-    the Directors recognise that the current conditions in equity markets may 
not be conducive for equity fund raisings by non-income generating companies, 
and therefore believe that the lack of liquidity in the Ordinary Shares will 
continue; and 
 
             -matters relating to maintaining a public listing are consuming a 
considerable amount of senior management's time, at the expense of the Company's 
day-to-day operations and its business development. 
 
 
 
 
After careful deliberation, the Board has concluded that it is in the best 
interests of the Company to de-list from AIM. 
 
2.    Shareholders' approval 
 
 
Under the AIM Rules for Companies, a cancellation of admission to trading on AIM 
must be approved by not less than 75 per cent of shareholders voting in a 
general meeting and the expiration of a period of at least twenty Business Days 
from the date on which notice of the Proposed De-listing was given. In addition, 
a period of at least five Business Days following the Shareholders' approval for 
the Proposed De-listing is required before the Proposed De-listing may be put 
into effect. Accordingly, the Company intends to seek shareholders' approval at 
the forthcoming AGM to be held at the offices of Suite No.1, 16th Floor, Sino 
Plaza, 255-257 Gloucester Road, Causeway Bay, Hong Kong at 4:30 pm (China time), 
corresponding to 9:30am (London time) on 22 May 2009. If the resolution for the 
Proposed De-listing is approved, it is expected that cancellation of dealings 
will take effect at 7 a.m. (London time) on 3 June 2009, with the last day of 
dealings in the Company's Shares on AIM being 2 June 2009. 
 
 
3. Irrevocable undertakings 
 
 
The Company has received irrevocable undertakings from Zijin Tongguan and 
LS-Nikko Copper Inc. that they will not sell any of their Ordinary Shares prior 
to completion of the Proposed De-listing and that they will vote in favour of 
the Proposed De-listing. Accordingly, the Company has secured voting commitments 
in favour of the Proposed De-listing from shareholders representing 89.9 per 
cent of the Ordinary Shares. 
 
 
4. Transactions in the Ordinary Shares following the Proposed De-listing 
 
 
Upon completion of the Proposed De-listing, there will be no market facility for 
dealing in the Ordinary Shares and no price will be publicly quoted for the 
Ordinary Shares. As such, the Ordinary Shares will not be traded on a public 
stock market and there will not be a quoted price for the Shares. 
 
 
The Directors are aware that any Shareholders may still wish to acquire further, 
or dispose of, Ordinary Shares after completion of the Proposed De-listing and, 
accordingly, the Company intends to use reasonable endeavours to create and 
maintain a matched bargain settlement facility for at least 6 months after the 
Proposed De-listing. Under this facility shareholders or persons wishing to 
acquire Shares will be able to leave an indication with the matched 
bargain settlement facility provider that they are prepared to buy or sell 
Shares at an agreed price. In the event that the matched bargain settlement 
facility provider is able to match that order with an opposite sell or buy 
instruction, the matched bargain settlement facility provider will contact both 
parties and then effect the order. Shareholders will need to register with the 
matched bargain settlement facility provider as a new client and transfer their 
respective shareholdings to a designated nominee account. This can take some 
time to process and therefore Shareholders who consider they may wish to avail 
themselves of this facility are encouraged to commence such registration and 
transfer at the earliest opportunity. The contact details of the matched bargain 
settlement facility provider will be made available to Shareholders on 
the Company's website, once such facility has been arranged. 
 
 
Please note however that the Company will give periodic consideration to the 
benefit and the cost of maintaining such matched bargain settlement facility and 
decide whether to continue or stop provision of such matched bargain settlement 
facility following the expiry of 6 months after the Proposed De-listing. 
 
 
After the Proposed De-listing, the Directors of the Company will give periodic 
consideration as to whether it is appropriate to apply for re-listing of the 
Company on a stock exchange and when this may be appropriate. The Company 
intends to consider an application for re-listing if and when the Company is 
able to obtain broad acceptance of the relevant peasant communities in northern 
Peru along with the required permissions from the Peruvian government (which 
may take some time to obtain) and commence exploitation activities. However, 
please note that any proposed re-listing plans will be subject to a number of 
commercial, legal and regulatory considerations. 
 
 
5. Arrangement with Warrantholder 
 
 
The Company issued two warrants in respect of certain Ordinary Shares to 
Agropecuaria Las Huaringas S.A. ("ALH") under a warrant agreement dated 27 
August 2008. The Company has been discussing the Proposed De-listing with ALH in 
an effort to obtain its consent to the Proposed De-listing. The Company will 
make a further announcement regarding the progress and outcome of its discussion 
with ALH in due course. 
 
 
6. Annual General Meeting 
 
 
In addition to the resolution described above to cancel the admission of 
Ordinary Shares to trading on AIM, the following resolutions shall be tabled at 
the Company's Annual General Meeting on 22 May, in conjunction with the regular 
business of an AGM: 
 
1.   To receive the Report and Financial Statements 
2.   To approve the re-election of certain Directors 
3.   To approve the re-appointment of auditors 
4.   To seek authority to issue shares 
5.   To seek authority to allot equity securities for cash 
6.    To seek authority to make market purchases of Ordinary Shares 
 
For further information, please contact: 
+-----------------------------------------------+----------------------------------+ 
| Monterrico Metals Plc                         | [phone]                   | 
| Huang Xiaodong, Chief Executive Officer/ Shan |                                  | 
| Shan (Susan) Li, Finance Director and Company |                                  | 
| Secretary                                     |                                  | 
+-----------------------------------------------+----------------------------------+ 
|                                               |                                  | 
+-----------------------------------------------+----------------------------------+ 
| Evolution Securities Limited (nominated       | [phone]                 | 
| adviser)                                      |                                  | 
| Robert Collins / Barry Saint / Adam James /   |                                  | 
| Esther Lee                                    |                                  | 
+-----------------------------------------------+----------------------------------+ 
 
 
 
 
 
 
 
This information is provided by RNS 
            The company news service from the London Stock Exchange 
   END 
 
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