CATALIST-LISTED corporate accretion services provider Accrelist is proposing to consolidate every 20 existing ordinary shares in the company into one ordinary share, at a books closure date to be later determined, it announced on Wednesday after market close.
The consolidated shares will be traded on Catalist in lots of 100. The number of consolidated shares to which shareholders are entitled will be rounded down to the nearest whole consolidated share, with any fractions disregarded.
As at May 29, Accrelist has an issued and paid-up share capital of about S$113.9 million, comprising 5.58 billion shares, and no treasury shares. Assuming no new shares issued up to the books closure date, the consolidation will result in a total of 279.14 million consolidated shares.
Accrelist said it believes the proposed consolidation "will generally be beneficial to the company and its shareholders", with the potential to reduce share price volatility and the percentage transaction cost for trading each board lot, as well as to increase market interest and attractiveness of the company and its shares. But it added that shareholders should note that there is no assurance that the proposed share consolidation will achieve these results.
For the last six-month period from November 2018 to April 2019, and up to May 28, the absolute price of Accrelist's traded shares was between 0.2 and 0.5 Singapore cent. The volume-weighted average price (VWAP) for the same period was 0.4 Singapore cent. After the consolidation, the theoretical adjusted VWAP of each consolidated share will be eight Singapore cents.
The proposed consolidation is subject to receipt of approval-in-principle from the Singapore Exchange Securities Trading (SGX-ST) as well as shareholders' approval being obtained at an extraordinary general meeting (EGM) to be convened. An application will be made to the SGX-ST, and subject to the receipt of approval-in-principle, a circular containing notice of EGM and further information on the proposed share consolidation will be despatched to shareholders in due course.
Following its announcement, Accrelist requested a lifting of the trading halt that it had called the day before. Its shares last closed at 0.4 Singapore cent on May 28.