Tender offer, cancellation of admission to AIM
12 Enero 2010 - 1:30AM
UK Regulatory
TIDMPIXL
RNS Number : 3886F
Pixel Interactive Media Limited
12 January 2010
+-------------------------------------+------------------------------------+
| Press Release | 12 January 2010 |
+-------------------------------------+------------------------------------+
Pixel Interactive Media Ltd
("Pixel Media", "the Company" or "the Group")
Tender offer, cancellation of admission to AIM
and
Notice of General Meeting
Pixel Media (AIM:PIXL), Asia's leading online advertising sales network, today
announces a proposed return of cash by way of a Tender Offer, Share Repurchase
and the proposed cancellation of admission to AIM of the Company's ordinary
shares ('Cancellation').
The Board, together with its advisers, has been considering the Company's
current position and as a result, the Company now proposes to:
* purchase Ordinary Shares by way of a tender offer at a price of 12 pence per
Ordinary Share; and
* immediately following the Tender Offer, cancel the admission of its Ordinary
Shares to trading on AIM.
Pixel Media has sent a circular (the 'Tender Offer Circular') to Eligible
Shareholders (as defined in the Tender Offer Circular) detailing its proposed
tender offer to purchase up to 15,442,337
Ordinary Shares and thereby to
return a maximum of approximately GBP1.9 million in cash to shareholders (the
'Tender Offer').
The Tender Offer will be open from 12 January 2010 to 5:00 p.m. on 3 February
2010 and is being made at a price per existing Ordinary Share in issue
('Ordinary Share') of 12 pence (the 'Tender Price'). The Tender Price is equal
to the mid-market close price on 11 January 2010 and represents a premium to the
200 day moving average price of 11 pence per Ordinary Share.
The Tender Offer is conditional on the approval of shareholders at the
extraordinary general meeting of the Company to be held at 10.00am on 4 February
2010. The Tender Offer is only available to Eligible Shareholders in respect of
the number of Ordinary Shares registered in those shareholders' names at 5:00
p.m. on 3 February 2010 (the 'Record Date'). Shareholders
can decide whether
they want to tender any or all of their Ordinary Shares in the Tender Offer.
Background to the Proposals
The Company has made significant progress since being admitted to trading on AIM
in July 2006. The Company has increased its regional presence with an additional
five offices and grown turnover from $5.8 million to over $20 million.
Importantly, Pixel Media has established offices in some of the fastest growing
countries in the world and is well positioned to benefit from the continuing
move from traditional media to online media.
As part of this growth, Pixel Media has increased its number of site
representations from 24 to 520 site representations and ad networks, an increase
of 2167 per cent. Similarly, it has increased its number of advertisers from 239
to 421, an increase of 76 per cent.
The Company also now employs 72 people, compared to the 18 full time employees
the Company had on admission to AIM.
Stock market conditions
In July 2006, Pixel Media was admitted to AIM with a share price of 30.5 pence
per Ordinary Share. Throughout 2009, the share price of the Ordinary Shares has
traded on AIM in the range of 5 to 17 pence per Ordinary Share and the 200 day
moving average in 2009 was 11 pence per Ordinary Share.
This share price performance has been disappointing and a source of frustration
for the Board. The Directors believe that the development of the business, in
terms of turnover, underlying operational infrastructure, and the strength of
the Company's management team, have not been adequately reflected in the value
attributed by the public market to the Company's shares. The Directors believe
the reasons for this under-valuation are multiple and complex, but include a
lack of liquidity in the Company's shares (common to many small cap companies)
and global economic uncertainty.
Discussions with large shareholders and Board deliberations
Against this background, the Board has spent significant time evaluating
different strategic alternatives for the Company. These deliberations have taken
into account the current financial position of the Company, the Company's growth
strategy, the current financial climate and the relative benefits compared to
the ongoing costs of maintaining a listing on AIM. The Board has also taken into
account the views of the Company's large shareholders, as well as assessing the
position of the Company's shareholders as a whole.
Following careful consideration of these factors with its advisers, the Board
has decided that the ongoing costs of maintaining a listing on AIM outweigh the
relative benefits the listing on AIM provides to the Company.
The Proposals
The Board therefore believes that it is an appropriate time to return, through
the Tender Offer, cash to the Company's shareholders. Further to the
announcement made today, the Board has completed its detailed review of relevant
factors and can confirm that it is able to return up to a maximum of GBP1.9
million through the Tender Offer.
In arriving at the level of cash available to be returned to Shareholders, the
Board has taken account of the levels of funding remaining in the group to
enable it to implement its growth strategy and maintain necessary working
capital within the Company.
The Board has also concluded that it would be in the best interests of the
Company to cancel trading in the Company's shares on AIM and continue its growth
trajectory away from the public markets. In particular, the Cancellation should
allow the Company to reduce its operating expenses by over GBP200,000 per annum
and allow the Directors to grow the Company without the pressure a quoted
company may face to deliver short term share price performance over long term
positioning and growth. Ultimately, the Board believes that greater shareholder
value will be derived by operating the Company's business off-market for the
immediate future.
The Board recognises that not all Shareholders will be able or willing to
continue to own shares in the Company following the Cancellation. The Tender
Offer therefore gives such Shareholders an opportunity to dispose of or reduce
their interest in the Company.
Those Shareholders who want to continue to own shares in the Company after it
de-lists from AIM may do so.
Irrevocable Undertakings
Each Director who holds Ordinary Shares and certain significant shareholders
have confirmed to the Company that they will not be tendering any of the
Ordinary Shares held by them in the Tender Offer. The total number of Ordinary
Shares covered by these irrevocable undertakings is 23,194,595 Ordinary Shares
representing 60.0% of the Company's issued share capital.
The Company has received sufficient irrevocable undertakings to ensure that
sufficient funds are available to purchase all Ordinary Shares validly tendered.
Following successful completion of the Proposals, and given the maximum number
of Ordinary shares tendered pursuant to the Tender Offer, the Company expects to
have in the region of GBP0.6 million in cash which the Directors believe will be
sufficient for working capital purposes and to achieve its growth strategy over
the next three to five years.
Share transfers may still be effected after the date of Cancellation by
depositing a duly executed and stamped stock transfer form together with an
appropriate share certificate with the company secretary at the registered
office of the Company. While the Ordinary Shares will remain freely
transferable, they may be more difficult to sell compared to shares of companies
listed on AIM.
The Tender Offer document has today been sent to shareholders and is available
on the Company's website: www.pixelmedia-asia.com.
A General Meeting will be held at the offices of Stephenson Harwood, One St.
Paul's Churchyard, London, EC4M 8SH at 10.00am on 4 February 2010.
Kevin Huang, CEO of Pixel Media, commented: "The Directors believe that the
development of the business, in terms of turnover, underlying operational
infrastructure, and the strength of the Company's management team, have not been
adequately reflected in the value attributed by the public market to the
Company's shares. Having evaluated a number of strategic options, we believe it
is in the best interests of shareholders for Pixel to cancel its listing on AIM.
The outlook for Pixel remains extremely positive and we feel confident that as a
private company, Pixel will be well placed to continue to grow turnover and
profitability, maximising value for our shareholders."
Expected Timetable
+--------------------------------------------------+----------------------+
| Tender Offer opens | 12 January |
+--------------------------------------------------+----------------------+
| Latest time and date for receipt of Forms of | 10.00 a.m. on 3 |
| Proxy | February |
| for the General Meeting | |
+--------------------------------------------------+----------------------+
| General Meeting of Pixel Media | 10.00 a.m. on 4 |
| | February |
+--------------------------------------------------+----------------------+
| Latest time and date for receipt of Tender Forms | 5.00 p.m. on 3 |
| and | February |
| TTE instructions from CREST in relation to the | |
| Tender Offer | |
+--------------------------------------------------+----------------------+
| Tender Offer Record Date | 5.00 p.m. on 3 |
| | February |
+--------------------------------------------------+----------------------+
| Announcement of the results of the Tender Offer | 4 February |
+--------------------------------------------------+----------------------+
| Effective date for Share Repurchase and | 4 February |
| completion of | |
| the Tender Offer | |
+--------------------------------------------------+----------------------+
| Cheques issued/CREST accounts credited for | By 10 February |
| Tender Offer | |
| Proceeds in respect of Ordinary Shares sold | |
+--------------------------------------------------+----------------------+
| CREST accounts credited/share certificates | By 10 February |
| issued for | |
| revised holdings of Ordinary Shares following | |
| the sale | |
| of Ordinary Shares under the Tender Offer | |
+--------------------------------------------------+----------------------+
| Return of share certificates in respect of | By 10 February |
| unsuccessful | |
| tenders | |
+--------------------------------------------------+----------------------+
| Last expected day of dealing in Ordinary Shares | 11 February |
| on AIM | |
+--------------------------------------------------+----------------------+
| Cancellation of the admission to trading on AIM | 12 February |
| of the | |
| Ordinary Shares | |
+--------------------------------------------------+----------------------+
- ENDS -
For further information:
+----------------------------------------+--------------------------------+
| Pixel Interactive Media Limited | |
+----------------------------------------+--------------------------------+
| Kevin Huang, Chief Executive Officer | Tel: +852 2851 2490 |
+----------------------------------------+--------------------------------+
| kevin.huang@pixelmedia-asia.com | www.pixelmedia-asia.com |
+----------------------------------------+--------------------------------+
| | |
+----------------------------------------+--------------------------------+
| Canaccord Adams Limited | |
+----------------------------------------+--------------------------------+
| Mark Williams / Bhavesh Patel | Tel: +44 (0) 20 7050 6500 |
+----------------------------------------+--------------------------------+
| | www.canaccordadams.com |
+----------------------------------------+--------------------------------+
Media enquiries:
+----------------------------------------+-------------------------------+
| Abchurch Communications | |
+----------------------------------------+-------------------------------+
| Joanne Shears / Simone Elviss | Tel: +44 (0) 20 7398 7700 |
+----------------------------------------+-------------------------------+
| joanne.shears@abchurch-group.com | www.abchurch-group.com |
+----------------------------------------+-------------------------------+
About Pixel Media
Pixel Media is a leading Asian online advertising sales network headquartered in
Hong Kong with offices throughout Asia including Beijing, Hanoi, Ho Chi Minh
City, Hong Kong, Shanghai, Singapore and Kuala Lumpur and is listed on AIM,
London Stock Exchange (Ticker: PIXL.L).
Pixel Media specializes in the sale of branded display online advertising on
behalf of premium branded web publishers while working closely with advertisers
and agencies to deploy effective interactive marketing campaigns for valuable
brands. For more information, visit us at www.pixelmedia-asia.com
- ENDS -
This information is provided by RNS
The company news service from the London Stock Exchange
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