EKF Diagnostics Holdings PLC Update (8764Z)
March 20 2017 - 2:01AM
UK Regulatory
TIDMEKF
RNS Number : 8764Z
EKF Diagnostics Holdings PLC
20 March 2017
This announcement contains inside information for the purposes
of Article 7 of Regulation (EU) No 596/2014 (MAR).
EKF Diagnostics Holdings plc
("EKF", the "Company")
Update
EKF Diagnostics Holdings plc (AIM: EKF), the AIM listed
point-of-care business, announces the following update for
shareholders.
The Directors are currently evaluating plans under which they
would split the Company into two separate companies based on the
business divisions, namely Point of Care and Lab Diagnostics.
Whilst both these business divisions are valuable in their own
right, the Directors consider that separating the companies out
represents a better route for shareholders and one under which they
are more likely to achieve a fair reflection of the value of each
separate business.
However, based on tax advice received by the Company, it is the
Directors' understanding that US federal income tax chargeable on
any gain associated with the divestiture of the business could be
significant. In order to mitigate these potentially adverse tax
effects, the distribution needs to qualify as a 'tax-free spinoff'.
There are numerous requirements in order to achieve this treatment,
including that no acquisition of 50% or more of the shares in
either the Company (i.e. the business that remains following the
divestiture) or the newly separated company may take place within
two years of the separation. Accordingly, the articles of
association of the two separate companies would be amended so as to
include a prohibition of the sale of 50% or more of the shares in
the companies without the consent of their directors.
The implementation of the above proposal is envisaged to include
a cancellation of the Company's shares from trading on AIM
following which it is the Directors current intention to seek a
listing of the shares of both companies on a market to be
determined.
The Directors are sympathetic to individual investors'
requirements and therefore in order to provide those shareholders
that do not wish to wait for the completion of the restructuring
and subsequent potential sale of the two businesses with an exit,
the Company is evaluating the possibility of a share buyback offer
to shareholders. This share buyback offer would, if completed, be
prior to the commencement of the separation and would be at a price
of 21.5p per share.
There can of course be no guarantee that the above proposals,
including any share buyback, will be capable of being completed in
the manner currently anticipated. Further announcements will be
made at the appropriate time
EKF Diagnostics Holdings plc www.ekfdiagnostics.com
Christopher Mills, Non-Executive Tel: 029 2071 0570
Chairman
Julian Baines, CEO
Richard Evans, FD & COO
N+1 Singer (Nomad & Broker) Tel: 020 7496 3000
Alex Price / Shaun Dobson
Walbrook PR Limited Tel: 020 7933 8780 or ekf@walbrookpr.com
Paul McManus / Lianne Cawthorne Mob: 07980 541 893 / 07584 391 303
This information is provided by RNS
The company news service from the London Stock Exchange
END
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