Venturecorp to look at delisting

Press, 24 October 1989, Page 26

Venturecorp to look at delisting

PA “ - Wellington Venturecorp Investments is to ask its 4191 shareholders for approval to have the company’s shares delisted from the New Zealand Stock Exchange. The mandate will be sought at the company's annual meeting -on November 16 when a resolution on proposing the delisting will be put forward for discussion.

In the company’s annual report for the June 30 year, company chairman, Mr C. G. Perrin, said the company faced two major costs in the present financial year — interest, and the cost of remaining a public listed company.

Mr Perrin said costs which can loosely be described as the costs of being a public listed company amounted to $105,000 in the year under review.

“These include such items as audit fees, annual report costs, stock exchange fees, directors' fees and share registry fees,” he said. “It is clearly an expensive exercise for Venturecorp to be a public listed company given the very low trading in its shares on the stock exchange.”

Mr Perrin said if the shares were delisted it would mean Venturecorp remaining as an unlisted public company. The shares could still be traded by private sale, he said.

"The only benefit to Venturecorp at present in being listed is that it gives shareholders the ability to sell their shares if there are buyers. "In the company’s present position there is very little trading and the low share price makes many sales un-

economic anyway after brokerage and other costs.

"Directors are of the view that the benefits to shareholders of being listed do not warrant the associated costs and accordingly recommend that the company be delisted,” Mr Perrin said.

The general manager, Mr L. E. Stephenson, said the company would not be able to guarantee shareholders would be able to sell their shares if they were delisted. There was, he said, no understanding that directors would buy any shares offered for sale. '

Mr Stephenson said he did not know whether major shareholders would vote in favour of the delisting proposal. He said he did not think the proposal would be all that; contentious..

If the shareholders rejected it the company would

be burdened with additional costs.

Venturecorp shares last traded at 3c on the sharemarket, meaning that shareholders would need to sell 10,000 shares to have a marketable parcel without incurring additional brokerage costs.

An analysis of Venturecorp’s shareholders in the annual report shows that only 154 of the 4191 shareholders held parcels of more than 10,000 shares at June 30. The proposal to delist Venturecorp shares follows a precedent set by Strathmore Holdings at its annual meeting last December.

A move to delist that company’s shares did not meet with sufficient shareholder support to persuade the chairman, Dr Ray Thomson, that it should be done.