TIDMQRT
RNS Number : 2237V
Quarto Group Inc
30 November 2023
NOT FOR RELEASE, PUBLICATION OR DISTRIBUTION, IN WHOLE OR IN
PART, DIRECTLY OR INDIRECTLY, IN, INTO OR FROM ANY JURISDICTION
WHERE TO DO SO WOULD CONSTITUTE A VIOLATION OF THE RELEVANT LAWS OR
REGULATIONS OF THAT JURISDICTION
FOR IMMEDIATE RELEASE
30 November 2023
THE QUARTO GROUP INC.
PROPOSED CANCELLATION OF ADMISSION OF THE COMPANY'S COMMON
SHARES TO THE PREMIUM SEGMENT OF THE OFFICIAL LIST AND TO TRADING
ON THE MAIN MARKET FOR LISTED SECURITIES OF THE LONDON STOCK
EXCHANGE
The Quarto Group Inc. ("Quarto" or the "Company") today
announces:
-- the Company's intention to cancel the admission of the
Company's common shares of US$0.10 each to the premium segment of
the Official List and to trading on the Main Market for listed
securities of the London Stock Exchange ("De-listing"), subject to
Shareholder Approval, with effect from 18 January 2024; and
-- the posting of a circular to Shareholders (the "Circular"),
which contains further information on the De-listing and the effect
of the De-listing on Shareholders and holders of Depository
Interests and notice of a special meeting (the "Special Meeting"),
which is to be held at 1 Triptych Place, Second Floor, London, SE1
9SH, United Kingdom on 14 December 2023 at 12.00 p.m. at which
shareholder approval will be sought for the De-listing.
The Listing Rules require that, if a company wishes to cancel
its listing on the Official List, it must seek the approval of (i)
a majority of not less than 75 per cent of votes attaching to
shares voted on a resolution of Shareholders (the "Resolution") and
(ii) a majority of the votes attaching to the shares of Independent
Shareholders who votes on the Resolution, in each case voting in
person or by proxy. If approved, it is anticipated that the
effective date of the De-listing will be 18 January 2024, being not
less than 20 business days from the passing of the Resolution.
The Board considers that the De-listing is in the best interests
of the Company and its Shareholders as a whole. Accordingly, the
Board unanimously recommend Shareholders vote in favour of the
Resolution.
The Company has received irrevocable undertakings to vote in
favour of (or recommend to the registered holder that they vote in
favour of) the Resolution at the Special Meeting and not to accept
the Tender Offer in the event that the Company implements the
Tender Offer from certain Shareholders representing in aggregate
29,612,326 Common Shares, representing in aggregate approximately
72.4% of the Company's issued share capital as at close of business
on 28 November 2023.
The Board recognises that the effects of the De-listing are
significant for Shareholders and holders of Depository Interests,
in particular the loss of protections afforded by the Listing Rules
and the loss of liquidity provided by the existing listing
arrangements. The Board therefore intends to make the Tender Offer
to provide Qualifying Shareholders and holders of Depository
Interests with a means to realise their investment in the Company
for cash after the De-listing has occurred. Further details of the
proposed Tender Offer are set out in the Circular. Shareholders and
holders of Depository Interests should be aware that although as at
the date of this announcement it is the intention of the Board to
proceed with the Tender Offer, there can be no guarantee that the
Company will actually make the Tender Offer.
Unless otherwise defined herein, capitalised terms have the same
meaning as those defined in the Circular.
BACKGROUND TO AND REASONS FOR THE DE-LISTING
The Directors have conducted a review of the benefits and
drawbacks to the Company, its Shareholders and holders of
Depository Interests in relation to its listing on the Main Market.
As part of their review, the Directors considered the following
matters, amongst others:
a) the effects of the De-listing being significant for
Shareholders and holders of Depository Interests, in particular in
terms of the loss of the protections afforded to Shareholders and
holders of Depository Interests by the Listing Rules;
b) the loss of protections given by the Disclosure Guidance and Transparency Rules ("DTR"); and
c) the loss of liquidity provided by the existing listing arrangements.
The Board explored the possibility of transferring the Company's
listing to AIM in the past few years. However, the Board concluded
that the benefits of becoming an unlisted private company at this
stage of the Company's development outweigh the potential benefits
of seeking admission to another market in London.
The Directors have considered the strategy for the Company to
ensure that it is in the best position to be able to raise funds
and enter into strategic transactions to develop the business
whilst also ensuring the Company continues to meet its financial
commitments and yields a return for Shareholders and holders of
Depository Interests.
The Directors unanimously believe that the De-listing is in the
best interests of the Company and its Shareholders (and holders of
Depository Interests) as a whole. In reaching their decision, the
Directors have considered the following key factors, amongst
others:
1) the De-listing will result in certain costs savings, plus
administrative and transactional efficiencies for the Company;
2) the Company will gain the flexibility to close future
acquisitions more quickly without having to comply with the Listing
Rules;
3) that the Company's Common Shares historically have a low
average daily trading volume, which makes the Company's share price
susceptible to significant fluctuations after trades involving
small numbers of shares; and
4) that the Company's Common Shares suffer from limited
liquidity and a low free float of approximately 17%, which limits
the benefits that the Company can gain from accessing capital
through the London Stock Exchange.
Further details of the factors considered by the Board in
reaching its decision are set out in the Circular.
PRINCIPAL EFFECTS OF THE DE-LISTING
(1) Trading and liquidity
Following the De-listing, the Common Shares will no longer be
traded on a public market or trading facility on any recognised
investment exchange. As a result, Shareholders and holders of
Depository Interests will not be able to trade their Common Shares
on the London Stock Exchange and, consequently, the opportunity for
Shareholders and holders of Depository Interests to realise their
investment in the Company will be limited.
Following the De-listing, the liquidity and marketability of the
Common Shares may be significantly reduced, and the value of such
shares may be adversely affected as a consequence. It may also be
more difficult for Shareholders and holders of Depository Interests
to determine the market value of their investment in the Company at
any given time.
As described above, however, if there is sufficient interest
from Shareholders and holders of Depository Interests, it is the
current intention of the Board to make the Tender Offer following
the De-listing, which will enable Shareholders to sell some or all
of their shares if they would like to do so. Furthermore, the Board
will consider making arrangements for a matched bargain facility to
be put in place in order to give Shareholders and holders of
Depository Interests the opportunity to trade in the Common Shares
after the De-listing and Tender Offer have completed. However,
there are no guarantees that the Company will proceed with the
Tender Offer and/or put in place a matched bargain facility.
(2) Disclosure and Reporting
The Company will no longer be subject to the regulatory and
financial reporting regime applicable to companies whose shares are
admitted to the Official List and to trading on the Main Market
including the Listing Rules, the Disclosure and Transparency Rules,
Market Abuse Regulations and the Corporate Governance Code.
To mitigate the loss of protections set out above, after the
De-listing has become effective, the Company will implement certain
corporate governance and disclosure measures as set out below:
-- The Board is committed to keeping Shareholders and holders of
Depository Interests informed of key developments in the business,
which it will do by sending the Company's annual report to
Shareholders and holders of Depository Interests by post.
Shareholders and holders of Depository Interests should be aware
that there will be no obligation on the Company to include all of
the information required by, or to update the website as required
by, the Listing Rules.
-- 1010 Printing Limited of the Lion Rock Group is a controlling
shareholder of the Company. The Company and the controlling
shareholder shall enter into a relationship agreement to ensure
that the controlling shareholder does not exert improper influence
over the Company and all transactions between the Company and the
controlling shareholder shall be conducted at arm's length and on
market terms and conditions.
-- As part of the Lion Rock Group, which is listed on the Hong
Kong Stock Exchange, the Company will provide updates in accordance
with the applicable disclosure requirements of Appendix 16 of the
Rules Governing the Listing of Securities on The Stock Exchange of
Hong Kong Limited and with Hong Kong Accounting Standard 34
"Interim Financial Reporting" issued by the Hong Kong Institute of
Certified Public Accountants.
(3) Corporate Governance
The Company will no longer be required to comply with the FRC's
Corporate Governance Code or any of the additional corporate
governance requirements applicable to companies admitted to the
premium segment of the Official List of the FCA and to trading on
the Main Market for listed securities of the London Stock Exchange.
However, the Directors intend to continue to operate the Company
for the benefit of all Shareholders and holders of Depository
Interests. They also intend to continue to keep Shareholders and
holders of Depository Interests informed of progress and remain
committed to high standards of corporate governance. As such, the
Company will hold shareholder meetings in accordance with statutory
requirements and the Company's by-laws.
The Company does not currently envisage making any changes to
its Board composition as a consequence of the De-listing.
(4) Taxation
The De-listing might have personal taxation consequences for
Shareholders and holders of Depository Interests. Shareholders and
holders of Depository Interests who are in any doubt about their
tax position should consult their own professional independent
adviser immediately.
(5) Depository Interests
Following the De-listing, those interests in Common Shares held
as Depository Interests will remain in place until further
notice.
The above considerations are not exhaustive, and Shareholders
and holders of Depository Interests should seek their own
independent advice when assessing the likely impact of De-listing
on them.
SHAREHOLDER CIRCULAR
Shareholders are urged to read the Circular as a whole and in
its entirety. The Circular contains further information on the
De-Listing and a notice of Special Meeting.
The Circular will be submitted to the National Storage Mechanism
and available shortly at
https://data.fca.org.uk/#/nsm/nationalstoragemechanism.
A copy of this announcement and the Circular will also be
available at the Company's website:
https://www.quarto.com/aboutus/investornews.aspx.
DISCLAIMER
Forward-looking statements
This announcement contains statements about the Company that are
or may be "forward-looking statements". All statements, other than
statements of historical facts, included in this announcement may
be forward-looking statements. Without limitation, any statements
preceded or followed by, or that include, the words "targets",
"plans", "believes", "expects", "aims", "intends", "will", "may",
"should", "anticipates", "estimates", "projects" or words or terms
of similar substance, or the negative thereof, are forward-looking
statements. These forward-looking statements are not guarantees of
future performance and have not been reviewed by the auditors of
the Company. They appear in a number of places throughout this
announcement and include statements regarding the intentions,
beliefs and current expectations of the Company or the Directors
concerning, amongst other things, the results of operations,
financial condition, liquidity, prospects, growth and strategies of
the Company and the industry in which the Group operates.
These forward-looking statements involve known and unknown
risks, uncertainties and other factors which may cause the actual
results, performance or achievements of the Company to be
materially different from any results, performance or achievements
expressed or implied by such forward-looking statements. These
forward-looking statements are based on numerous assumptions
regarding the present and future business strategies of the Company
and the environment in which it will operate in the future.
Past performance is not a guarantee of future performance.
Investors should not place undue reliance on such forward-looking
statements and, save as is required by law or regulation, the
Company does not undertake any obligation to update publicly or
revise any forward-looking statements (including to reflect any
change in expectations with regard thereto or any change in events,
conditions or circumstances on which any such statement is based).
All subsequent forward-looking statements attributed to the Company
or any persons acting on its behalf are expressly qualified in
their entirety by the cautionary statement above. All
forward-looking statements contained in this announcement are based
on information available to the Directors of the Company at the
date of this announcement, unless some other time is specified in
relation to them, and the posting or receipt of this announcement
shall not give rise to any implication that there has been no
change in the facts set forth herein since such date.
Inside information
The information contained within this announcement is deemed by
the Company to constitute inside information as stipulated under
the Market Abuse Regulation (596/2014) ("MAR"). Upon the
publication of this announcement via Regulatory Information
Service, this inside information is now considered to be in the
public domain.
General
This announcement shall not constitute an offer to sell or the
solicitation of an offer to buy the Common Shares or Depository
Interests, nor shall there be any sale of the Common Shares or
Depository Interests in any jurisdiction in which such offer,
solicitation or sale would be unlawful prior to registration or
qualification under the securities laws of any such
jurisdiction.
ENQUIRIES
The Quarto Group Inc.
Daniel Logan, Group Finance Director +44 (0)20 7700 6700
Michael Clarke, Company Secretary
ABOUT QUARTO
Quarto creates a wide variety of books and intellectual property
products, with a mission to inspire life's experiences. Produced in
many formats for adults, children and the whole family, our
products are visually appealing, information rich and
stimulating.
Quarto encompasses a diverse portfolio of imprints and
businesses that are creatively independent and expert in developing
long-lasting content across specific niches of interest.
Quarto sells and distributes its products globally in over 50
countries and 40 languages, through a variety of sales channels,
partnerships and routes to market. The group was founded in London
in 1976. It is domiciled in the US and listed on the London Stock
Exchange.
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END
CIRBGBDBXDXDGXG
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