REG - React Group PLC - Proposed Share Consolidation & Notice of AGM

ReactAnnouncement

06/03/2024 07:00

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RNS Number : 7060F  React Group PLC  06 March 2024

 

REACT Group plc

("REACT" or the "Company")

 

Proposed Share Consolidation & Notice of AGM

 

The Board of REACT (AIM: REAT), the leading specialist cleaning, hygiene and
decontamination company, announces that it has posted a circular to
shareholders detailing the Board's proposal to consolidate the Company's share
capital with the aim of improving the marketability of the Ordinary Shares.
The Circular also contains the Notice of the Annual General Meeting to be held
at midday on Thursday 28(th) March 2024 in the Bishops Suite at Novotel London
Blackfriars, 46 Blackfriars Road, London SE1 8NZ.

 

Extracts from the Circular in connection with the Share Capital Consolidation
can be found below. Capitalised terms in this announcement will have the same
meaning as set out in the Circular.

 

Admission Statistics

 

 Number of Existing Ordinary Shares                                            1,067,648,507
 Number of Ordinary Shares in issue as at the Share Consolidation Record Date  1,067,648,550

 Conversion ratio of Existing Ordinary Shares to New Ordinary Shares           50:1
 Nominal value of an Ordinary Share following the Share Consolidation          12.5p
 Number of Ordinary Shares in issue immediately following the Share            21,352,971
 Consolidation

 TIDM                                                                          REAT
 LEI                                                                           213800H54C4GOFN7MO32

Expected Timetable of Principal Events

 

 Publication and posting of the Circular and the Form of Proxy to Shareholders  5 March 2024

 Latest time and date for receipt of completed Forms of Proxy and receipt of    midday on 26 March 2024
 electronic proxy appointments via the CREST system

 Time and date of the Annual General Meeting                                    midday on 28 March 2024
 Announcement of result of the Annual General Meeting                                           28 March 2024

 Record Date in respect of the Share Consolidation                              6.00 p.m. on 28 March 2024
 Admission expected to become effective and dealings expected to commence in    8.00 a.m. on 2 April 2024
 the New Ordinary Shares on AIM

 CREST accounts expected to be credited in respect of New Ordinary Shares in    2 April 2024
 uncertificated form

 Expected date by which certificates in respect of New Ordinary Shares are to   within 10 business days of Admission
 be despatched to certificated Shareholders

 

Notes:

1.     Unless otherwise stated, all references to time in the Circular and
in the above timetable are to the time in London, United Kingdom.

2.     Some of the times and dates above are indications only and it any
of the details contained in the timetable above should change, the revised
times and dates will be notified to Shareholders by means of an announcement
through a Regulatory Information Service.

3.     Events listed in the timetable above are conditional upon, amongst
other things, on the passing at the Annual General Meeting of the Resolutions.

 

 

 

Share Consolidation

Reasons for the Share Consolidation

 

The Directors believe that the Company's existing share capital structure is
no longer appropriate.  The Company has grown in size and the high number of
shares in issue combined with the relatively low price per share is thought to
result in excess volatility, reduced liquidity and a widening in the bid/offer
spread of the Existing Ordinary Shares. The Directors are therefore proposing
to consolidate the Existing Ordinary Shares so that every 50 Existing Ordinary
Shares are consolidated into one new ordinary share of 12.5p.  The Share
Consolidation will reduce the number of shares in issue from 1,067,648,507
Existing Ordinary Shares to 21,352,971 New Ordinary Shares.

 

The Share Consolidation is expected to:

 

-     increase the Company's share price proportionately;

-     help improve the market liquidity of, and trading activity in, the
Company's shares;

-     provide the basis for a narrowing in the spread of its bid and offer
price; and

-     enhance the perception of the Company and its prospects and help
improve the marketability of the Company's shares to a wider group of
investors.

 

The Share Consolidation requires the approval of Shareholders by way of a
special resolution at the AGM.

 

Application will be made in accordance with the AIM Rules for the New Ordinary
Shares arising from the Share Consolidation to be admitted to trading on AIM,
subject to Shareholders passing Resolution 6 at the Annual General Meeting. It
is expected that if Resolution 6 is passed, Admission in respect of such New
Ordinary Shares will become effective and that dealings in those New Ordinary
Shares will commence on 2 April 2024. The new ISIN Code and SEDOL Code will be
notified once these have been allocated.

 

Procedure

 

As at the date of the Circular, the Company has 1,067,648,507 Existing
Ordinary Shares in issue, with a closing mid-market price of 1.38 pence per
Existing Ordinary Share as at 4 March 2024 (being the latest practicable
Business Day prior to the date of the Circular).

 

It is therefore proposed, pursuant to the Share Consolidation, that the
Existing Ordinary Shares are consolidated on a 50 for 1 basis, so that every
50 Existing Ordinary Shares are consolidated into one ordinary share of 12.5
pence in nominal value.

 

No Shareholder will be entitled to a fraction of a New Ordinary Share.
Instead, their entitlement will be rounded down to the nearest whole number of
New Ordinary Shares. If a Shareholder holds fewer than 50 Existing Ordinary
Shares at the Record Date, such that the rounding down process results in a
Shareholder being entitled to zero New Ordinary Shares, then as a result of
the Share Consolidation they will cease to hold any Ordinary Shares (of any
description) in the capital of the Company.

 

Remaining fractional entitlements to New Ordinary Shares will be aggregated
and sold on behalf, and for the benefit, of the Company. Under the Company's
articles of association, the Directors have a discretion as to how to deal
with fractional entitlements, including by accounting to Shareholders for the
net proceeds of any sale. The maximum fractional entitlement that any
Shareholder would be entitled to would be worth only 12.25p and so, given the
cost of remitting the net proceeds of sale to Shareholders, the Directors
believe that the most sensible approach is to apply the net proceeds of sale
for the benefit of the Company.

 

In order to ensure that the Share Consolidation does not result in a fraction
of a New Ordinary Share being created, the Company will prior to the Record
Date issue such number of Ordinary Shares as will result in the total number
of Existing Ordinary Shares being divisible by 50.  These additional Ordinary
Shares will be issued to the Registrars and will only represent a fraction of
a New Ordinary Share.  This fraction will be aggregated with the other
fractions referred to above and sold in the market.

 

For the avoidance of doubt, the Company is only responsible for dealing with
fractions arising on registered holdings. For Shareholders whose Existing
Ordinary Shares are held in nominee accounts of UK stockbrokers, the effect of
the Share Consolidation on their individual shareholdings will be administered
by the stockbroker or nominee in whose account the relevant Existing Ordinary
Shares are held.  The effect is expected to be the same as for shareholdings
registered in beneficial names, however, it is the stockbroker's or nominee's
responsibility to deal with fractions arising within their customer accounts,
and not the Company's responsibility

 

Assuming a share capital of 1,067,648,507 Existing Ordinary Shares immediately
prior to the Record Date (plus 43 additional Ordinary Shares to be allotted to
the Registrars), following completion of the Share Consolidation the Company
will have 21,352,971 New Ordinary Shares in issue.

 

Shareholders intending to attend the Annual General Meeting are asked to
register their intention by midday on 26(th) March 2024 by sending an email to
info@reactsc.co.uk (mailto:info@reactsc.co.uk) .

 

Shareholders may participate in the AGM via the Investor Meet Company ("IMC")
platform but should note that this remote participation will not constitute
attendance at the AGM and will not enable shareholders to vote at the AGM.
Shareholders wishing to participate in the AGM via IMC should sign up for free
ahead of the AGM
via https://www.investormeetcompany.com/react-group-plc/register-investor
(https://www.investormeetcompany.com/react-group-plc/register-investor)  and
request to meet the Company. Registered shareholders will automatically be
emailed an invitation which they should accept in order to receive a unique
link to access the AGM.  Shareholders are encouraged to register with IMC
before the day of the AGM to avoid entry to the meeting being delayed.

 

For more information:

 

 REACT Group                           Tel: +44 (0) 1283 550 503
 Shaun Doak, Chief Executive Officer
 Spencer Dredge, Chief Financial Officer

 Mark Braund, Chairman

 Singer Capital Markets - Nominated Adviser & Joint Broker                           Tel: +44 (0) 207 496 3000
 Philip Davies / Alex Bond / Oliver Platts

 Dowgate Capital - Joint Broker                                                      Tel: +44 (0) 20 3903 7715
 Stephen Norcross / Nicholas Chambers

 IFC Advisory - Financial PR & IR      Tel: +44 (0) 20 3934 6630
 Graham Herring / Zach Cohen

 

 

About Us:

REACT Group plc is the UK's leading specialist and contract cleaning business
and operates with three divisions: LaddersFree, one of the largest commercial
window cleaning businesses in the UK; Fidelis Contract Services ("Fidelis"), a
contract cleaning and facilities maintenance business; and REACT business,
which primarily provides a solution to emergency and specialist cleaning
situations, both through long-term framework agreements and on an ad-hoc
basis.

 

 

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