Scotty Group SE Listing in Vienna & Proposed Cancellation from AIM (5349Z)

TIDMSCO

RNS Number : 5349Z

Scotty Group SE

08 March 2013

8 March 2013

SCOTTY Group SE

("SCOTTY" or the "Company")

Listing on the Third Market of the Vienna Stock Exchange

Proposed conversion of Placing Shares

Proposed cancellation of admission to trading on AIM

Trading update

SCOTTY announces that, with effect from 09:00 CET (08:00 GMT) today, the Ordinary Shares in the Company will commence trading on the Third Market of the Vienna Stock Exchange ("Third Market").

The Company also announces that, on 12 March 2013, it proposes to publish a notice to Shareholders in the Wiener Zeitung of an extraordinary general meeting to be held on 3 April 2013 at 10:00 CET (09:00 GMT) at the offices of Sauerzopf & Partner, Boersegasse 9/3, A1010-Vienna, Austria ("EGM").

The purpose of the EGM is to seek Shareholders' approval for the Resolutions as follows:

   1.   to convert the Placing Shares into the same form as the Ordinary Shares; and 
   2.   to cancel the admission of the Shares to trading on AIM. 

An English translation of the Notice will be published on the Company's website at www.scottygroup.com on 12 March 2013. For the avoidance of doubt, this announcement does not comprise a formal notice of such meeting.

Details of the Resolutions to be proposed at the EGM, the background to and reasons for the Resolutions together with details of action to be taken by Shareholders and a recommendation from the Board are all set out below. Forms of proxy and forms of instruction for use at the EGM will be made available on the Company's website on 12 March 2013.

A trading update is also included below.

A table of defined terms used is set out at the end of this announcement.

Proposed Conversion of the Placing Shares into the same form as the Ordinary Shares

When the registered office of the Company was transferred from the United Kingdom to Austria in April 2012, new arrangements were put in place in order to comply with Austrian law and to enable the electronic settlement of the Company's Ordinary Shares through CREST. These new arrangements, an extract from which is set out below, were included in the appendix to the Schedule 1 Announcement published on 30 March 2012 and are available on the Company's website at www.scottygroup.com.

"Under the new arrangements, all of the Company's shares [were] reissued as CDIs. In order for Euroclear (as operator of the CREST system) to credit CDIs to CREST participants - either directly to Shareholders or to Capita IRG Trustees Limited, as nominee provider - it is necessary for their depository to "hold" the underlying shares. This is achieved through a chain of intermediaries whereby CREST International Nominees has an account with SIX-SIS Switzerland, which in turn has a securities account with OeKB in respect of the underlying shares. OeKB [holds] the global certificate in respect of the underlying shares and contractual arrangements [are] in place with Euroclear, SIX-SIS and OeKB in respect of these arrangements to cover the chain of ownership."

In accordance with this procedure, upon readmission to AIM on 11 May 2012, the Company's share capital of 969,640 shares (defined in this announcement as the Ordinary Shares) took the form of a global bearer share certificate held by OeKB (as custodian for the Shareholders) and CDIs, representing the share capital in the Company, were issued to Shareholders.

On 27 September 2012, the Company announced that it had issued the Placing Shares to a limited number of participants pursuant to the Placing.

At the time of the Placing, it was understood by the Board that the Placing Shares would be issued in the same form as the Ordinary Shares as described above, i.e. added to the global bearer share certificate, and CDIs would be created representing the Placing Shares. However, the Board was later made aware that the Placing Shares had been issued as "registered" shares as a result of which they could not be added to the global bearer share certificate nor allocated the same ISIN number as the Ordinary Shares.

The implications of the Placing Shares being issued in this way are that:

   -     CDIs have not been created in respect of the Placing Shares; 
   -     the Placing Shares are not yet capable of being traded; and 
   -     the Placing Shares (in their current form) cannot be listed on the Third Market (see below). 

However, the Placing Shares are registered and therefore entitled to vote.

In order to rectify these issues, the Placing Shares must be converted into the same form as the Ordinary Shares (i.e. into "bearer" shares). Under Austrian law, this conversion shall be effected if approved by Shareholders in a general meeting by a majority of not less than 75 per cent. of the share capital represented in the EGM in person or by proxy. The Board will therefore be seeking Shareholders' approval for the conversion. If such approval is obtained, application will then be made to OeKB for the shares to be registered as bearer shares as soon as practicable.

Listing on the Third Market of the Vienna Stock Exchange and proposed Delisting from AIM

In April 2012, SCOTTY transferred its domicile from the UK to Austria in order to align the Company's domicile more closely with the Company's centre of operations and achieve cost savings. Accordingly, the Company's registered office was transferred to Eisenstadt, Austria.

Following the change of domicile, the Board conducted a review of its strategy for listing its shares, considering the advantages and disadvantages of the existing AIM quote and a possible listing in Austria.

The Board believes that a listing on the Third Market will be beneficial to the Company and anticipates that this will improve liquidity in the Company's shares and assist the Company in raising further equity finance.

Pending approval by Shareholders of conversion of the Placing Shares into the same form as the Ordinary Shares, the Company applied for and received permission for admission to trading of the Ordinary Shares on the Third Market and today is the first day of trading as announced above. The Ordinary Shares will trade on the Third Market under the ticker "SGS".

Application for the Placing Shares to be listed on the Third Market will also be made once they have been converted into the same form as the Ordinary Shares if the conversion is approved at the forthcoming EGM.

The Board has also considered the advantages and disadvantages of the Company's existing AIM quotation and has concluded that it is in the best interests of the Company and Shareholders for admission to trading on AIM to be cancelled. In reaching this conclusion, the Directors have taken into account the following factors:

-- The principal reason for SCOTTY's listing on AIM was to provide the Company with access to capital in order to fund its strategy and to use its shares for acquisitions. The Directors consider that it is and will be difficult for the Company to attract meaningful equity investment through its quotation on AIM.

-- The quotation of SCOTTY's Shares on AIM has not, in practice, provided investors with anticipated levels of liquidity or marketability for their shares. As a result, the share price has been volatile from time to time.

-- There are significant costs associated with a quotation on AIM and the Board is keen to reduce costs where possible and focus resources on the business.

-- Admission to trading on the Third Market aligns the listing of the Company's shares with its centre of operations and domicile in Austria.

-- The Directors do not consider it appropriate for a company of SCOTTY's size to be listed on more than one exchange in the long-term.

Pursuant to AIM Rule 41, (i) Delisting can only be effected by the Company after securing a resolution of Shareholders in a general meeting passed by a majority of not less than 75 per cent. of the votes cast by Shareholders (in person or by proxy); (ii) Delisting can only take place after the expiration of a period of twenty Business Days from the date on which notice of the Delisting is given; and (iii) a period of at least five Business Days following Shareholders' approval of the Delisting is required before the Delisting may be put into effect.

The Company has notified the London Stock Exchange of the proposed Delisting. In the event that Shareholders approve the Delisting, it is anticipated that the last day of dealings in the Shares on AIM will be Wednesday 10 April 2013, the Business Day before Delisting becomes effective.

Effect of Delisting

Under the timetable described above, the Ordinary Shares will for a time be listed on AIM and the Third Market. There will therefore be no break in Shareholders' ability to trade their shares. After Delisting has taken place, Shareholders will no longer be able to trade their shares on AIM but will be able do so on the Third Market, as explained below.

The Third Market

The Third Market is a multilateral trading facility (MTF) operated by the Vienna Stock Exchange. Trading takes place through XETRA (Exchange Electronic Trading), a pan-European electronic and automated trading system of Deutsche Börse AG for trading in equities, bonds and structured products pursuant to the Trading Rules for XETRA.

On the Third Market, orders can only be placed by a member of the Vienna Stock Exchange. Therefore, Shareholders will be able to trade their shares on the Third Market by either directly placing an order via a member of the Vienna Stock Exchange or by instructing their bank, broker or other financial adviser to place the order via a member of the Vienna Stock Exchange.

A full list of members of the Vienna Stock Exchange together with contact details are provided at the following websites:

http://en.wienerborse.at/members/memberlist (English)

http://www.wienerborse.at/members/memberlist (German)

Trading on the Third Market

In order to have their shares traded on the Third Market, holders of CDIs will have to transfer the CDIs out of the CREST system and into a custody account eligible for settlement in the Austrian system administered by OeKB, at which point the securities will then no longer be denominated as CDIs but will be denominated as bearer shares Such transfer will be arranged by the CDI-holder's depositary bank, broker or similar financial agent directly. If and as long as a CDI-holder decides not to transfer the CDIs to a custody account as described above, the shares will not be tradable on the Third Market and will remain in his/her custody account, denominated as CDIs within the CREST system.

Shareholders who previously held their Shares in certificated form and who elected to participate in the Company's CSN Scheme administered by Capita IRG Trustees Limited ("Capita") will be able to trade their shares on the Third Market by contacting a broker of their choice, or Capita Share Dealing Services, whose contact details are set out below:

Telephone

   UK:                   0871 664 0364 (calls cost up to 10p per minute plus network extras) 

Ireland: lo-call 1 890 946 375

   Overseas:          [phone] 

Lines are open Monday to Friday, 09:00-17:30 CET (08:00-16:30 GMT)

   Email:               [e-mail] 
   Post:                Capita Share Dealing Services, PO Box 276, Beckenham, Kent BR3 4UL, UK 

Shareholders who previously held their Shares in certificated form but who have not yet elected to participate in the CSN Scheme will continue to have their shares held in CDI form in a bare trust, administered by Capita. These Shareholders will not be able to exercise their voting rights or trade their shares until they (a) elect to participate in the CSN Scheme, or (b) issue a valid instruction to transfer the CDIs to another CREST account.

Shareholders who are not yet participants in the CSN Scheme may apply to Capita to participate in the CSN Scheme by completing a form of acknowledgement ("FOA") and returning it to Capita. This may be done before or after Delisting. FOAs were sent to Shareholders with the circular dated 18 April 2012 and Shareholders who had not responded were sent a further copy of the FOA at the time of the notice of the annual general meeting dated 28 August 2012. If you still require a FOA, please contact Capita, whose contact details are as follows:

Telephone

   UK:                   0871 664 0335 (calls cost up to 10p per minute plus network extras) 
   Overseas:          [phone] 

Lines are open Monday to Friday, 10:00-18:30 CET (09:00-17:30 GMT)

   Email:               [e-mail] 

The Board has concluded that it is in the best interests of Shareholders as a whole that Delisting be approved and will be seeking Shareholders' approval for Delisting at the forthcoming EGM.

Recommendation

The Directors unanimously recommend that Shareholders vote in favour of the Resolutions, as they intend to vote in respect of their own current beneficial holdings of, in aggregate, 660,487 of the Company's Shares, representing 45.4 per cent. of the current issued ordinary share capital of the Company.

Action to be taken:

Shareholders who hold their shares directly in CREST

If you wish to be represented at the EGM, please complete the Form of Proxy which will be published on the Company's website on 12 March 2013. The completed Form of Proxy is either to be presented at the EGM or returned to the Company in accordance with the instructions printed thereon as soon as possible and, in any event, so as to be received no later than 10:00 CET (09:00 GMT) on Tuesday 2 April 2013. Completion and return of a Form of Proxy will not preclude you from attending the EGM and voting in person if you wish.

Shareholders who are members of the CSN Scheme operated by Capita

You should not complete the Form of Proxy. Instead, you should complete the Form of Instruction which will be published on the Company's website on 12 March 2013 and return it to Capita (not to the Company) in accordance with the instructions printed thereon, as soon as possible and, in any event, so as to be received by Capita no later than 10:00 CET (09:00 GMT) on Wednesday 27 March 2013.

Trading Update

In our trading update on 21 December 2012, we commented that conversion of projects into firm orders was continuing to take longer than planned, owing to slippage in customers' programmes, including delays at short notice to the timing of some orders. As a result the Group's revenue experienced further slippage; turnover in the second half year showed an improvement compared with the first half, but the total for the financial year ending 31 December 2012 as a whole was approximately Euros 4.2 million.

We are anticipating that 2013 will be another difficult trading year as governments' austerity programmes continue to delay their equipment purchasing plans. Conversely, the increased threats from illegal immigration and terrorism worldwide are generating heightened interest in our aero-surveillance systems. In 2012, the group's revenue was weighted towards the second half of the financial year and we anticipate that the profile will be similar in 2013.

One potential area of uncertainty has recently been removed (earlier than last year) as we have already received the firm purchase order and delivery schedule for the aero-certified systems to be delivered in 2013 under SCOTTY's continuing PV contract with Eurocopter. The delivery schedule comprises six systems and an additional spares order, with a combined sales value of approximately Euros 1.7 million, and is for delivery between June and December 2013, thus largely influencing the second half of 2013.

We are anticipating additional orders from our relationship with Diamond Aircraft Industries using their DA 42 MPP platform. We are also working on further potential aero-surveillance projects with Airborne Technologies using the Tecnam aircraft and with the French Military's C130 aircraft.

2013 is the first full year of our new relationship with AirScan, our strategic partners in the USA. AirScan has 24 years of worldwide operational experience in C4ISR (Command, Control, Communications and Computers in Intelligence, Surveillance and Reconnaissance) systems. We are currently specifying new products to be developed jointly with AirScan and we expect that this relationship will bring increased opportunities for SCOTTY's aero-certified surveillance systems.

As previously announced, in December 2012 the Board approved a cost reduction programme, both for the parent company, SCOTTY Group SE, and its Austrian operating subsidiary, SCOTTY Group Austria GmbH, aimed primarily at reducing personnel and administration costs by approximately Euros 0.4 million in 2013, whilst maintaining the Group's existing research and development capabilities.

EXPECTED TIMETABLE OF PRINCIPAL EVENTS

 
                                                                  2013 
 Publication of Notice of EGM in Wiener               Tuesday 12 March 
  Zeitung (in German) and on the Company's 
  website (in English and German) 
 Publication of the Form of Instruction               Tuesday 12 March 
  and Form of Proxy on the Company's website 
 Latest time and date for receipt of Forms       10:00 CET (09:00 GMT) 
  of Instruction by Capita                       on Wednesday 27 March 
 Latest time and date for receipt of Forms         Presentation in the 
  of Proxy by the Company                            EGM or receipt by 
                                                  the Company by 10:00 
                                                    CET (09:00 GMT) on 
                                                       Tuesday 2 April 
 Extraordinary General Meeting in Vienna,        10:00 CET (09:00 GMT) 
  Austria                                         on Wednesday 3 April 
 Last day of dealings in the Company's Shares       Wednesday 10 April 
  on AIM 
 Cancellation of the admission to trading        08:00 CET (07:00 GMT) 
  of the Company's Shares on AIM                  on Thursday 11 April 
 

Dates set against events that are expected to occur after the expected date of the EGM assume that the EGM is not adjourned and that the Resolutions are passed at the EGM.

Enquiries:

 
 SCOTTY Group SE                        www.scottygroup.com 
  Kurt Kerschat, CEO                        [phone] 
 Nominated Adviser 
  Cairn Financial Advisers LLP 
  Tony Rawlinson / Avi Robinson            [phone] 
 Broker 
  Northland Capital Partners Limited 
  John Howes                               [phone] 
 

DEFINITIONS

 
 "AIM"                     AIM, a market operated by the London Stock 
                            Exchange; 
 "Business Day"            means a day other than a day which is a Saturday, 
                            a Sunday or public holiday in England; 
 "CET"                     Central European Time (one hour after GMT); 
 "certificated" or         where a security is not held in uncertificated 
  "in certificated          form (i.e. not in CREST); 
  form" 
 "Company" or "SCOTTY"     SCOTTY Group SE; 
 "CSN Scheme"              the corporate sponsored nominee scheme operated 
                            by Capita on behalf of the Company, for Shareholders 
                            who formerly held their shares in certificated 
                            form and who have elected to participate in 
                            the scheme; 
 "CREST"                   the relevant system (as defined in the CREST 
                            Regulations) in respect of which Euroclear 
                            is the Operator (as defined in the CREST Regulations); 
 "CDIs"                    CREST depository interests, representing shares 
                            in the Company, which may be held and transferred 
                            through the CREST system, affording shareholders 
                            the same economic benefits as ordinary shares, 
                            including the right to vote and to receive 
                            dividends; 
 "CREST Regulations"       The Uncertificated Securities Regulations 
                            2001 (SI2001/3755) as amended; 
 "Delisting"               the proposed cancellation of admission of 
                            the Shares to trading on AIM; 
 "Directors" or "Board"    the directors of the Company; 
 "Euroclear"               Euroclear UK and Ireland Limited, the operator 
                            of CREST; 
 "Form of Instruction"     The instruction to be returned to Capita, 
                            recording the voting instructions of participants 
                            in the Corporate Sponsored Nominee Scheme; 
 "Form of Proxy"           the Power of Attorney and form of proxy enclosed 
                            with this document for use by Shareholders 
                            in connection with the EGM; 
 "Extraordinary General    the extraordinary general meeting of the Company 
  Meeting" or "EGM"         to be convened for 10:00 CET (09:00 GMT) on 
                            3 April 2013 at the at the offices of Sauerzopf 
                            & Partner, Boersegasse 9/3, A1010-Vienna, 
                            Austria; 
 "GMT"                     Greenwich Mean Time; 
 "ISIN"                    International Securities Identification Number; 
 "London Stock Exchange"   London Stock Exchange plc; 
 "Notice"                  the notice of EGM, to be published on 12 March 
                            2013; 
 "OeKB"                    Oesterreichische Kontrolbank AG; 
 "Ordinary Shares"         969,640 ordinary shares of 1 Euro each in 
                            the capital of the Company, held through CDIs; 
 "Placing"                 the issue of equity announced by the Company 
                            on 27 September 2012; 
 "Placing Shares"          the 484,820 shares of 1 Euro each in the capital 
                            of the Company issued in the Placing; 
 "Resolutions"             the resolutions to be proposed at the EGM 
                            as set out in the Notice; 
 "Shares"                  the 1,454,460 ordinary shares in the Company, 
                            comprising the Ordinary Shares and the Placing 
                            Shares; 
 "Shareholders"            holders of Shares and the term "Shareholder" 
                            shall mean any one of them; 
 "Third Market"            the Third Market ("Dritter Markt") of the 
                            Vienna Stock Exchange; and 
 "uncertificated"          ordinary shares which are recorded on the 
  or "in uncertificated     register of members of the Company as being 
  form"                     held in uncertificated form in CREST and title 
                            to which, by virtue of the CREST Regulations, 
                            may be transferred by means of CREST. 
 

This information is provided by RNS

The company news service from the London Stock Exchange

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