TIDMMEDG TIDMMEDU
RNS Number : 3130B
Medgenics Inc
03 March 2014
Press Release 3 March 2014
Medgenics, Inc. Announces Proposed Cancellation of
Admission to Trading on AIM
Medgenics, Inc. (NYSE MKT: MDGN and AIM: MEDU, MEDG) (the
Company), the developer of Biopump(TM) a novel technology for the
sustained production and delivery of therapeutic proteins in
patients using ex-vivo gene therapy and their own tissue for the
treatment of rare and orphan diseases, today announced that it has
filed preliminary proxy materials with the U.S. Securities and
Exchange Commission (SEC) in connection with the Company's Annual
Meeting of Stockholders on 8 April 2014, which, among other
proposals, seeks stockholder approval for the cancellation of the
admission of its common stock for trading on the London Stock
Exchange's Alternative Investment Market (AIM). If stockholders
approve the cancellation of admission to trading on AIM, it is
anticipated that the last day of trading on AIM will be 15 April
2014, and the effective date of cancellation will be 16 April
2014.
Background
The Company's shares of common stock have been admitted to
trading on AIM, since December 2007. Unlike certain other U.S. and
foreign exchanges, the AIM Rules for Companies do not require
companies to maintain a minimum number of publicly traded shares
outstanding at any given time, nor do they require companies to
maintain a minimum market capitalization. The Company sought
admission to the public market during the early stages of its
development by listing shares of its common stock on AIM. In April
2011, the Company completed the initial public offering of its
common stock in the United States. At that time, the Company's
common stock also became listed on the NYSE MKT (previously known
as the NYSE Amex). The Company's Board of Directors unanimously
considers the cancellation of admission of its common stock to
trading on AIM to be in the best interests of the Company and its
stockholders as a whole.
Reasons for the Cancellation of Admission to AIM
The Company's Board of Directors has identified the following
reasons for the proposed cancellation, which it considers to be in
the long-term best interests of the Company:
The high costs of maintaining the AIM listing. The Company
estimates that the annual costs of maintaining a listing on AIM
exceed $250,000, and these costs are in addition to the similarly
high costs of U.S. securities regulatory and other requirements for
maintaining a listing in the United States.
Trading on AIM has been limited. The trading of the Company's
common stock on AIM has been very limited. A diminishing percentage
of the total number of shares of the Company's outstanding common
stock is listed on AIM, decreasing from 24% at the end of 2012 to
17% as of 21 February 2014. In addition, based upon information
available to the Company, the trading volume of shares of the
Company's common stock on AIM averaged less than 1,400 shares per
day in 2013, compared to approximately 65,700 shares per day on the
NYSE MKT. The Company believes that these numbers indicate that an
effective market has not been created on AIM for the trading of its
common stock.
The need to maintain appropriate liquidity of the Company's
common stock. With the listing of the Company's common stock on the
NYSE MKT, the Company's Board of Directors is concerned that there
may not be enough liquidity for its common stock to support trading
on two exchanges. The Board of Directors believes it is in the best
interests of the Company and its stockholders to consolidate the
trading of its common stock onto one exchange.
The operational and legal difficulties of being subject to two
different regulatory regimes in two different countries, in order
to maintain listings on both AIM and the NYSE MKT. The Company is
required to comply with the regulatory, reporting and corporate
governance requirements of two exchanges, whose requirements are
sometimes different and/or conflicting. In addition, the Company's
auditors are required to review its financial statements from the
perspective of both the SEC and AIM, and the Company must make
filings both with the SEC and on AIM relating to financial
statements and other matters. The Board of Directors believes that
it is in the best interests of the Company and its stockholders to
remove the requirement of compliance with two different regulatory
regimes, and that compliance with the requirements of the SEC and
the NYSE MKT would continue to provide stockholders with
appropriate protections with respect to regulatory, reporting and
corporate governance matters.
The management time taken up with the AIM listing. The Company
currently has a very small management team, and this small team is
managing multiple programs both in the United States and outside
the United States for the development and regulatory approval of
the Company's Biopump Platform Technology. The ongoing regulatory
requirements associated with the Company's securities listings in
two countries are diverting management time and attention which
could more usefully be deployed on Company operations.
Access to capital. The Company believes that accessing
additional capital will likely be more efficient on a U.S.
exchange, or through private offerings, than on AIM.
Effects of the Cancellation of Admission to AIM
If the proposal for cancellation of admission to AIM is approved
by the Company's stockholders, the last day of trading of the
Company's common stock on AIM is expected to be 15 April 2014, with
the cancellation of admission to trading on AIM becoming effective
from 7:00 a.m. (London time) on 16 April 2014. Following the
cancellation, there will be no market facility in the United
Kingdom for dealing in the Company's common stock or depository
interests derived from its common stock. Stockholders and current
holders of depository interests wishing to publicly trade their
shares will need to do so through the NYSE MKT.
Following the cancellation of admission to AIM, the Company
would continue to be subject to the SEC's reporting obligations,
and the Company intends to maintain the listing of its common stock
on the NYSE MKT. The Company intends to continue to keep
stockholders informed of its financial and operational performance
through the required filings with the SEC, as well as updates in
press releases and on the Company's website at
http://www.medgenics.com.
Following the cancellation of admission to AIM, all shares of
the Company's common stock that are entered on the register
maintained by Capita Registrars in Jersey will be placed on the
Company's U.S. share register. In addition, the CREST depository
interest facility will be terminated following cancellation of
admission to trading on AIM; the shares held in such facility will
be withdrawn, re-materialised and placed on the Company's U.S.
share register; and the ISIN for the securities previously held in
the CREST system will be disabled and expire. Either Capita
Registrars or Corporate Stock Transfer, the Company's U.S. transfer
agent and registrar, will send out transmittal letters to all
stockholders whose shares were previously entered on the share
register maintained by Capita Registrars and all holders of
depository interests in CREST providing them with further
information regarding the transfer of their shares to the Company's
U.S. share register.
Vote Required
The AIM Rules for Companies provide that the affirmative vote at
a general meeting of the company of at least 75% of the votes cast
will be required for approval of the cancellation. Accordingly,
assuming a quorum is present, the approval of the cancellation of
the admission of the Company's common stock to trading on AIM
requires the affirmative vote of at least 75% of the votes cast, in
person or by proxy, at the annual meeting. Abstentions will have no
effect on this proposal, but will be counted when determining
whether there is a quorum present at the Annual Meeting of
Stockholders.
Expected timetable of principal events
Filing of preliminary proxy materials with the SEC 29 February 2014
Mailing of definitive proxy materials to 11 March 2014
stockholders of record
Annual Meeting of Stockholders of Medgenics, Inc. 8 April 2014
Last day of dealings of shares of AIM and in CREST 15 April 2014
Proposed cancellation of admission to trading on AIM 16 April 2014
Each of the times and dates in the above timetable is subject to
change. If any of the above times and/or dates change, the revised
times and dates will be notified to the Company's stockholders by
an announcement through a regulatory information service.
Additional Information
This press release is not a solicitation of stockholders or
their votes with respect to any of the proposals contained in the
preliminary proxy materials. Medgenics, Inc. urges investors to
review the proxy statement and other information filed with the SEC
because they contain important information regarding the matters to
be voted on at the annual meeting. These documents are available
without charge on the SEC website at www.sec.gov. A free copy of
the preliminary proxy statement may also be obtained on the
Company's website at www.medgenics.com.
This announcement is being made pursuant to the London Stock
Exchange's AIM Rules for Companies admitted to trading on the AIM
market.
About Medgenics
Medgenics is developing and commercializing Biopump(TM), a
proprietary platform for the sustained production and delivery of
therapeutic proteins using ex-vivo gene therapy and the patient's
own tissue for the treatment of orphan and rare diseases. For more
information, visit the Company's website at www.medgenics.com.
Forward-looking Statements
This release contains forward-looking statements within the
meaning of Section 27A of the Securities Act of 1933, Section 21E
of the Securities Exchange Act of 1934 and as that term is defined
in the Private Securities Litigation Reform Act of 1995, which
include all statements other than statements of historical fact,
including (without limitation) those regarding the Company's
financial position, its development and business strategy, its
product candidates and the plans and objectives of management for
future operations. The Company intends that such forward-looking
statements be subject to the safe harbors created by such laws.
Forward-looking statements are sometimes identified by their use of
the terms and phrases such as "estimate," "project," "intend, "
"forecast," "anticipate," "plan," "planning, "expect," "believe,"
"will," "will likely," "should," "could," "would," "may" or the
negative of such terms and other comparable terminology. All such
forward-looking statements are based on current expectations and
are subject to risks and uncertainties. Should any of these risks
or uncertainties materialize, or should any of the Company's
assumptions prove incorrect, actual results may differ materially
from those included within these forward-looking statements.
Accordingly, no undue reliance should be placed on these
forward-looking statements, which speak only as of the date made.
The Company expressly disclaims any obligation or undertaking to
disseminate any updates or revisions to any forward-looking
statements contained herein to reflect any change in the Company's
expectations with regard thereto or any change in events,
conditions or circumstances on which any such statements are based.
As a result of these factors, the events described in the
forward-looking statements contained in this release may not
occur.
For further information, contact:
Medgenics, Inc.
John Leaman, CFO
john.leaman@medgenics.com
Abchurch Communications Phone: +44 207 398 7718
Joanne Shears / Jamie Hooper / Harriet
Rae
harriet.rae@abchurch-group.com
Oriel Securities (NOMAD & Broker) Phone: +44 207 710 7617
Jonathan Senior / Giles Balleny
- Ends -
This information is provided by RNS
The company news service from the London Stock Exchange
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