MS International plans move to AIM

1st Oct 2013 09:21

Shares in MS International dropped Tuesday after the group announced plans to convene a general meeting at which it will seek to gain shareholder approval to move the company from the main LSE market to AIM. The group said it believes the move would be in the best interests of the company as AIM would provide a "more suitable market" that would enable it to simplify its administrative and regulatory requirements. The directors had so far received irrevocable undertakings to vote in favour of the move from shareholders holding a total of 72.2% of the issued shares. Michael Bell, Executive Chairman of MS International, said: "As Chairman and a major shareholder of the company, I firmly believe that the proposal to move to AIM is the right thing to do for the company and all its shareholders and recommend that you support the proposal."The group also said it feels a move to AIM would offer it greater flexibility, could make its shares more attractive to retail investors, and said some individuals who hold ordinary shares could, after two years, be eligible for certain inheritance tax benefits. It also pointed out that the UK government's proposed abolishment of stamp duty on shares traded on AIM in April 2014 should, if implemented, help increase liquidity in the trading of the company's shares, should the AIM admission proceed.If it goes ahead, the last day of trading on the main market is expected to be November 21st 2013, with trading on AIM beginning the following day. Current TradingThe group also updated on its current trading, saying both its Forgings and Petrol Station Superstructures divisions were performing well, and that prospects for their revenue growth remains favourable. That said, the company warned that much of the global defence sector remained characterised by persisting procurement budget constraints and prevailing uncertainties."Whilst our 'Defence' division has a substantial order book for delivery in future years and a considerable pipeline of un-awarded new business prospects, the delay in such prospects becoming confirmed orders, means the company expects its revenue for the first half year and the year as a whole to be less than that reported last year," it said. "Furthermore, given the highly operationally geared nature of the 'Defence' division, the board expects the company's profits before tax to be appreciably less in both instances than that reported last year." The group continued to have a "robust" balance sheet, with substantial net cash and short term deposits. It plans to maintain the dividend for the year, the group added. Shares fell 10.78% to 182p in morning trade.NR