Webis Holdings PLC Proposed Voluntary Cancellation of Admission

RNS Number : 3080N

Webis Holdings PLC

22 November 2024

 

22 November 2024

 

Webis Holdings plc

("Webis" or "the Company")

 

 

Proposed Voluntary Cancellation of Admission to Trading on AIM and Notice of General Meeting

 

 

The board of Webis, the Group specialising in pool wagering and the operators of WatchandWager Cal Expo, the Californian harness track, today announces:

 

·    subject to Shareholder approval, the proposed cancellation of the admission of its ordinary shares of 1 pence each ("Ordinary Shares") from trading on AIM (the "Cancellation"); and

·    the posting of a circular to Shareholders (the "Circular") which contains further information on the proposed Cancellation and notice of a general meeting be held on Wednesday 18 December at 10.00 a.m. at The Claremont Hotel, 18/19 Loch Promenade, Douglas, Isle of Man (the "General Meeting") at which shareholder approval will be sought for the Cancellation.

 

 

Ed Comins, Managing Director of Webis, stated:

 

"Following an in-depth review, the Board has unanimously agreed that it is in the best interests of the Company and its Shareholders to delist from AIM. The Company continues to believe WatchandWager has a unique position in the USA as one of the top five licensed operators in our sector and the Board believes that the Cancellation will reduce costs and protect shareholder value as the Group seeks to grow its business in North America and deliver on strategic goals".

 

Proposed Voluntary Cancellation

 

Despite the best endeavours of the Board and its management team, the performance of the Group has not improved in-line with expectations, and the losses for the financial period ending May 2024 are expected to be approximately US$1,063,000.

 

Whilst the Company continues to believe WatchandWager has a unique position in the USA as one of the top five licensed operators in our sector (with a stable platform of technology, payments, licenses, and most importantly content) the Board's previously indicated strategy of seeking potential buyers, or commercial partners, for the business, or certain of its assets, have not materialised.

 

Our licensed operation at Cal Expo with its "bricks and mortar" presence in California, is a significant asset on the Company's balance sheet, and enhances the Group's profile and position in California, but remains loss-making.

 

In light of the above, the Board reviewed its current status and future options including the benefits and drawbacks to the Company retaining its admission on AIM. The Board has concluded that the Cancellation is in the best interests of the Company and its Shareholders as a whole.

 

To be passed, the resolution to approve the Cancellation requires, pursuant to Rule 41 of the AIM Rules, the approval of not less than 75 per cent. of the votes cast by Shareholders at the General Meeting.

 

Following Cancellation, the Company will consider putting in place a matched bargain facility to assist shareholders to trade Webis shares. If implemented, the matched bargain facility would be made available directly through the Company. Under the matched bargain facility, Webis shareholders or other persons wishing to acquire or dispose of Ordinary Shares would be able to leave an indication with the matched bargain facility provider that they are prepared to buy or sell at a particular price. In the event that the matched bargain facility provider is able to match that order with an opposite sell or buy instruction, the matched bargain facility provider would contact both parties and then effect the bargain. However, shareholders should note that the Company is not formally committing to put in place a matched bargain facility and such facility is unlikely to be in place immediately following the Cancellation and, if implemented, may not remain in place for an extended period of time. Further information will be made available as and when appropriate.

 

General Meeting

 

The General Meeting will be held on Wednesday 18 December at 10.00 a.m. at The Claremont Hotel, 18/19 Loch Promenade, Douglas, Isle of Man.

 

Resolution 1 to be proposed at the General Meeting is a special resolution to approve the Cancellation.

 

A copy of this announcement and the Circular will be made available on the Company's website later today at www.webisholdingsplc.com

 

 

 

This announcement contains inside information for the purposes of Article 7 of the Market Abuse Regulation (EU) No. 596/2014, as it forms part of UK Domestic Law by virtue of the European Union (Withdrawal) Act 2018. Upon the publication of this announcement, this inside information is now considered to be in the public domain.

 

 

For further information:

 

Webis Holdings plc	Tel:	01624 639396
Denham Eke   Beaumont Cornish Limited	Tel:	020 7628 3396
Roland Cornish/James Biddle

 

Nominated Adviser

Beaumont Cornish Limited ("Beaumont Cornish") is the Company's Nominated Adviser and is authorised and regulated by the FCA. Beaumont Cornish's responsibilities as the Company's Nominated Adviser, including a responsibility to advise and guide the Company on its responsibilities under the AIM Rules for Companies and AIM Rules for Nominated Advisers, are owed solely to the London Stock Exchange. Beaumont Cornish is not acting for and will not be responsible to any other persons for providing protections afforded to customers of Beaumont Cornish nor for advising them in relation to the proposed arrangements described in this announcement or any matter referred to in it.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

APPENDIX I

 

Extracts from the Circular

 

 

Reasons for the proposed Cancellation

 

Despite the best endeavours of the Board and its management team, the performance of the Group not improved in-line with expectations, and the losses for the Group for the financial period ending May 2024 are expected to be approximately US$1,063,000.

 

Whilst the Company continues to believe WatchandWager has a unique position in the USA as one of the top five licensed operators in our sector (with a stable platform of technology, payments, licenses, and most importantly content) the Board's previously indicated strategy of seeking potential buyers, or commercial partners, for the business, or certain of its assets, have not materialised.

 

Our licensed operation at Cal Expo with its "bricks and mortar" presence in California, is a significant asset on the Company's balance sheet, and enhances the Group's profile and position in California, but remains loss-making.

 

In light of the above, the Board reviewed its current status and future options including the benefits and drawbacks to the Company retaining its admission on AIM. The Board has concluded that the Cancellation is in the best interests of the Company and its Shareholders as a whole. In reaching this conclusion, the Board has considered the following key factors:

 

(a)  the significant cost savings to be achieved by the Cancellation;

(b)  the Directors do not believe that the Company's share price reflects the underlying value of the Company's assets (most notably, the value of certain licenses owned by the Group);

(c)  the free float of the Company is only 36.9 per cent. and trading volumes in respect of the Shares are very low and this illiquidity prevents Shareholders from trading in meaningful volumes or with any frequency;

(d)  the Company has not utilised its admission on AIM to raise fresh capital or issue Shares as consideration to fund acquisitions since January 2013;

(e)  the Company remains reliant on its major shareholder, Mr Mellon, for funding to meet its ongoing working capital needs and despite several efforts it has been unable to attract capital on acceptable terms from third party investors, in particular through equity issues on AIM;

(f)  the management time and the legal and regulatory burden associated with maintaining the Company's admission to trading on AIM is, in the Directors' opinion, disproportionate to the benefits to the Company; and

(g)  the Directors believe that trading of the Ordinary Shares on AIM significantly inhibits flexibility of the business

 

 

 

Process for Cancellation

 

Shareholder Approval Required

The Cancellation is conditional, pursuant to Rule 41 of the AIM Rules, upon the approval of not less than 75 per cent. of the votes cast by Shareholders (whether present in person or by proxy) at the General Meeting. The Company is therefore seeking Shareholders' approval of the Cancellation at the General Meeting.

 

Timetable for Cancellation

In accordance with Rule 41 of the AIM Rules, the Company has notified London Stock Exchange plc of its proposed Cancellation from trading on AIM and has provided not less than 20 clear Business Days' notice of Cancellation.

 

Cancellation will not take effect until at least five clear Business Days have passed following the passing of the Authorising Resolution. If the Authorising Resolution is passed at the General Meeting, it is proposed that the last day of trading in Ordinary Shares on AIM will occur on 2 January 2025 and that the Cancellation will take effect at 7:00 a.m. on 3 January 2025 (the "Cancellation Date").

 

 

Implications of proposed Cancellation

 

Set out below is an overview of the principal effects of the Cancellation, however, this list in not exhaustive. Shareholders should seek their own independent advice when assessing the likely impact of the Cancellation on them:

 

·          there will be no formal public market mechanism enabling the Shareholders to trade Ordinary Shares and no price will be publicly quoted for the Shares;

·          the Ordinary Shares may be more difficult to sell compared to shares of companies traded on AIM (or any other recognised market or trading exchange);

·          while the Ordinary Shares will remain freely transferable (subject to the provisions in the Company's Articles of Association), it is possible that the liquidity and marketability of the Ordinary Shares will, in the future, be more constrained than at present and the secondary market value of such shares may be adversely affected as a consequence;

·          in the absence of a formal market quote, it may be more difficult for Shareholders to determine the market value of their investment in the Company at any given time;

·          the regulatory and financial reporting regime applicable to companies whose shares are admitted to trading on AIM will no longer apply;

·          the AIM Rules will no longer apply to the Company and, accordingly, Shareholders will no longer be afforded the protections given by the AIM Rules.  In particular, the Company will not be bound to:

(a)  make any public announcements of material events, or to announce interim or final results;

(b)  comply with any of the corporate governance practices applicable to AIM companies;

(c)  announce substantial transactions and related party transactions;

(d)  comply with the requirement to obtain shareholder approval for reverse takeovers and  fundamental changes in the Company's business; or

(e)  comply with AIM Rule 26, obliging the Company to publish prescribed information on its website;

 

·          the Company will cease to have an independent nominated adviser and broker;

·          whilst the Company's CREST facility will remain in place following the Cancellation, the Company's CREST facility may be cancelled in the future and, although the Ordinary Shares will remain transferable, they will cease to be transferable through CREST. In this instance, Shareholders who hold Ordinary Shares in CREST will receive share certificates; and

·          the Cancellation may have additional taxation consequences for Shareholders. Shareholders who are in any doubt about their tax position should consult their own professional independent tax adviser.

 

Shareholders should also note that the City Code on Takeovers and Mergers (the "Takeover Code") may continue to apply to the Company following the Cancellation for a period of ten years, provided the Company continues to have its place of central management and control in the UK, Channel Islands or Isle of Man. However, in the event that, subsequent to the Cancellation further Board changes result in the Company's place of central management and control being outside the UK, Channel Islands or Isle of Man, then the Company may not be subject to the Takeover Code. Shareholders should also note that the Panel has recently issued a public consultation regarding possible changes to the Takeover Code which, if adopted, would amongst other things shorten the period during which the Takeover Code potentially continues to apply to a company following its delisting. If these rule changes are adopted in the form and broadly in the timescale proposed, the Company would cease to be subject to the Takeover Code three years after the date of implementation of such changes.

 

The Company will continue to be bound by its Articles of Association and the Isle of Man Companies Acts, 1931 - 2004 (each of which requires shareholder approval for certain matters) following the Cancellation.

 

These considerations are not exhaustive and Shareholders should seek their own independent advice when assessing the likely impact of the Cancellation on them.  Shareholders should be aware that if the Cancellation takes effect, they will at that time cease to hold Shares in a company whose shares are admitted to trading on AIM and the matters set out above will automatically apply to the Company from the date of the Cancellation.

 

After the Cancellation, the Company will continue to comply with the applicable statutory requirements of a company incorporated in the Isle of Man.

 

 

Shareholders Access to Information following Cancellation

 

The Company currently intends that it will continue to provide certain facilities and services to Shareholders that they currently enjoy as shareholders of a company whose shares are admitted to trading on AIM. In particular the Company will:

 

·          continue to communicate selected information about the Company to its Shareholders; and

·          continue, to post updates (where deemed necessary or appropriate) on the Company's website from time to time, although Shareholders should, however, be aware that there will be no obligation on the Company to include all of the information required under AIM Rule 26 or to update its website as required by the AIM Rules.

 

 

 

Transactions in Ordinary Shares prior to and post the proposed Cancellation

 

Prior to Cancellation

If Shareholders wish to buy or sell Ordinary Shares on AIM they must do so prior to the Cancellation becoming effective. If Shareholders approve the Cancellation, it is anticipated that the last day of dealings in the Ordinary Shares on AIM will be 2 January 2025. The Board is not making any recommendation as to whether or not Shareholders should buy or sell their Ordinary Shares.

 

Post Cancellation

The Directors are aware that the proposed Cancellation, should it be approved by Shareholders at the General Meeting, would make it significantly more difficult for Shareholders to buy and sell Ordinary Shares should they wish to do so. Following Cancellation the Company will consider putting in place a matched bargain facility to assist Shareholders to trade Company shares. If implemented, the matched bargain facility would be made available directly through the Company. Under the matched bargain facility, Shareholders or other persons wishing to acquire or dispose of Ordinary Shares would be able to leave an indication with the matched bargain facility provider that they are prepared to buy or sell at a particular price. In the event that the matched bargain facility provider is able to match that order with an opposite sell or buy instruction, the matched bargain facility provider would contact both parties and then effect the bargain. Further information will be made available as and when appropriate.

 

For a period, to be determined by the Board, following Cancellation Shareholders will continue to be able to hold their Ordinary Shares in the CREST uncertificated form and should check with their existing stockbroker that they are able to hold unquoted shares.

 

Shares held through an ISA account

The Ordinary Shares will cease to be eligible to be held within an Individual Savings Account ("ISA") upon the Cancellation taking effect.  An ISA manager will have to either sell Ordinary Shares held in a Shareholder's ISA or transfer them to the Shareholder to be held outside an ISA, within 30 calendar days of the Cancellation.

 

When the title of an investment in an ISA is transferred from an ISA manager to an investor, the investor is deemed to have sold the investment for a market value sum and immediately reacquired it for the same amount.  Any notional gain on the deemed sale is exempt from charge.  Any future capital gains or losses are calculated by reference to the value of the shares when they left the ISA.  This is the combined effect of regulations 22 and 34 of the Individual Savings Account Regulations 1998.  It is not, however, clear how this general tax treatment applies when shares are transferred out of an ISA after a delisting.

 

This summary is for general information purposes only.  It is not intended to constitute tax or other advice and should not be relied on or treated as a substitute for specific advice relevant to a Shareholder's specific circumstances.  Shareholders should consult their own professional advisers as soon as possible.

 

 

 

 

 

 

APPENDIX II

 

Expected Timetable of Principal Events

 

Publication of this Document	22 November 2024
Notice provided to the London Stock Exchange to notify it of the proposed Cancellation	22 November 2024
Latest time and date for receipt of Forms of Proxy in respect of the General Meeting	10.00 A.M on 16 December 2024
General Meeting	10.00 A.M on 18 December 2024
Expected last day of dealings in Ordinary Shares on AIM	2 January 2025
Expected time and date of Cancellation	07.00 A.M on 3 January 2025

 

Notes:

(a)             Unless otherwise specified, references in this Document to time are to London time (GMT).

(b)             The times and dates above are indicative only and subject to change.  If there is any change, revised times and/or dates will be notified to Shareholders by means of an announcement through a Regulatory Information Service.

 

 

 

 

 

 

 

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