Canned food maker and distributor G. Willi-Food Investments Ltd. (TASE:WLFD) unit Gold Frost Ltd. (AIM:GLF) plans to delist from London’s Alternative Investment Market (AIM). On Friday, the company's board has called a special general meeting on May 20 to approve the delisting of the company. If the measure is approved, the share will be delisted on May 28. Arcadi Gaydamak controls Willi-Food.
Gold Frost added, "Shareholders should note that cancellation is likely to reduce significantly the liquidity and marketability of the company's shares. Once cancellation has taken effect, the shareholders will no longer be able to effect transactions in the company's shares on market at the market price."
Gold Frost noted that there has been very limited trading in the company's shares in the last 10 months, and that the average daily trading volume between June 2007 and April 2008 was about 10,000 shares (approximately 0.019% of the company's outstanding share capital). This figure excludes purchases of 7.6 million shares by G. Willi-Food International Ltd. (Nasdaq:WILC) between November 2007 and January 2008. On 47 of the 55 business days since February 1, there was no trading in the company's shares at all.
The company added, "At the same time, the company has been incurring significant costs and expenses relating to the fact that its shares are listed on AIM, including fees paid to the company's nominated advisor and registrar, annual fees paid to the AIM, costs relating to public announcements, certain fees and expenses of directors and fees and expenses of accountants, counsel and a public relations firm engaged to provide services relating to the company's shares being listed on the AIM." The board therefore believes that it is the shareholders' best interest to delist the company in order to cut costs.
Gold Frost traded at ₤0.1725 on Friday, 51% below its IPO price. The share price was subsequently more than halved to ₤0.085, giving a market cap of ₤4.5 million, 76% below its IPO value. The share's 52-week high was ₤0.33.
Gold Frost stated, "Following cancellation, therefore, the company's shareholders will have to affect any further transactions in the company's shares off market at a price to be agreed between the relevant parties." Many of the company's shareholders will likely sell their shares to the company's controlling shareholders.
Published by Globes [online], Israel business news - www.globes-online.com - on April 27, 2008
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