In an announcement late Friday afternoon, after market close and just before the long weekend, AIM listed Fusionex announced that it’ll seek to delist from the AIM market. It’s not clear why this is often good for personal investors, the corporate is profitable and has no got to raise funds. The RNS says that a gathering will happen in Malaysia on 15 June to vote on the matter, which all of the administrators representing 41.93% of shares are in favour. most of those are within the hands of the CEO, Ivan Teh.
Unfortunately for Fusionex investors, this is able to leave them with no official market within the shares. While there’s an intention to place in situ a matched bargain settlement facility, this is often unlikely to supply much, if any liquidity. Syqic, another profitable Asian company which recently delisted itself, features a matched bargain facility. The trading volume within the previous couple of months? Nil.
It appears that the cancellation notice has already been delivered to AIM in anticipation, with cancellation expected on 27 June, but a month away. an extra RNS before the market open this morning saw the resignation of joint broker Peel Hunt, also as Chairman John Croft. The share price reaction today was brutal, with the shares down 64% by the close. Investors participating within the IPO in 2012 have lost two-thirds of their money – thus far . Shareholders will soon be in grave danger of being faced with a ‘lowball’ bid for his or her shares if they need to understand any value in the least .
Unless many of the non-Board holders vote against this delisting, it’s bound to happen. While this is often a Special Resolution, requiring 75% of votes cast, Mr Teh and a colleague control 54% of the shares. so as to be defeated, at two fifths of the remaining 46% of shares got to be cast against them. Unfortunately, voting turnouts are typically low for listed companies, allowing this sort of behaviour to persist; it might take a concerted effort to defeat this resolution. The nominee system makes it difficult for shareholders to get timely information about corporate actions, and voting are often difficult or maybe impossible. this is often particularly true as long as the meeting is merely 2 weeks away. All of this works to the advantage of the CEO who wishes to delist his company, and who will soon be safely faraway from regulatory scrutiny and market discipline.
The net result are going to be that yet one more name is added to the list of Asian based companies which have clothed to be a disaster for investors. Naibu, Camkids, Hirco, Jiasen, Taihua, Asian Citrus, Syqic, and lots of more. within the absence of any support from AIM for investors in these cases, investors would had best to be ever more wary of foreign companies listed in London.
Please support our shareholder rights campaign to reform the nominee account system, and make it harder for managements to use the barriers this technique presents to discourage shareholders from voting in their own interests.