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Business Reporter
Southern Africa-focused investment company Cambria Africa Plc intends to de-list from the Alternative Investment Market by end of next month subject to approval of the plan by its shareholders.

The cancellation means that there would no longer be a formal market mechanism for shareholders to trade their shares on AIM or any other recognised market or trading exchange.

In view of this, Cambria said the board intends to facilitate a dealing arrangement expected to be in place shortly after the date of cancellation to enable shareholders to trade the ordinary shares.

The company, which sent out circulars on Friday to its shareholders on the proposal, said the move followed a review of the benefit of the shares continuing to be traded on AIM with company’s advisers and its major shareholders, the directors agreeing that it is in the best interest of the company and its shareholders as a whole if the admission of the shares to trading on AIM is cancelled.

It added that the decision had been prompted by the failure of its Zimbabwean operations to grow resulting in it adopting a regionalisation strategy by shifting the focus from being exclusively Zimbabwe to include neighbouring countries such as Zambia and Malawi, with positive results being reflected in the improved financial performance of the Company but at a slow pace.

“Notwithstanding the initiatives to improve the company performance, and following careful consideration, the directors have concluded that it is no longer in the best interests of the company or its shareholders for Cambria to maintain the Admission or to remain a public limited company,” the company said.

In reaching this conclusion, Cambria said the directors had also considered that the sale of the Leopard Rock Hotel at a price well below expectations had resulted in the company’s total assets being significantly reduced.

This, it added, had made the significant professional fees associated with the Admission (such as legal, accounting, London Stock Exchange and nominated adviser costs) wholly disproportionate.

In addition the directors noted that the equally disproportionate amount of senior management time spent in ensuring compliance with the AIM Rules and related regulatory requirements, including reporting, disclosure and corporate governance requirements while the admission no longer serves a useful function for the company in terms of providing access to capital or enabling the ordinary shares to be used to effect acquisitions.

“The directors believe that as a result of the cancellation, Cambria would be better placed to focus on its orderly exit from the company’s remaining portfolio investments, including pursuing the claims against Lonrho currently in the English High Courts, and subsequent return of cash to shareholders.

“In this context, the directors believe that greater shareholder value will ultimately be derived by operating the company’s business off-market,” he said.

Cambria said if the cancellation come through it would continue to work to maximise the value of its existing assets and to seek an orderly exit from its existing portfolio of investments and return cash to its shareholders.