Adacel Technologies Limited (Adacel or the Company) was, at the request of the Company, removed from the Official List of the Australian Stock Exchange (ASX) on 8 January 2025 under Listing Rule 17.11. The removal of Adacel from the Official List of the ASX was completed pursuant to shareholder approval granted at the Company’s Annual General Meeting (AGM) held on 27 November 2024.
The Company has prepared the following frequently asked questions, to address some of the key queries raised by shareholders.
After reviewing, if you still have questions, please reach out to us.
Following the delisting of Adacel you will retain ownership of your existing shares, and they will continue to be registered with our share registry Boardroom (https://www.investorserve.com.au/). No action is required on your part. Where your shares were held via a broker on the CHESS sub-register, at delisting your shares will have been automatically moved to a new holding on the issuer sponsored sub-register and a new holding statement will have been provided to you.
Yes. Post-delisting, shares can be bought and sold via off-market private transactions. An off-market transfer form can be accessed at the following link:
https://boardroomlimited.com.au/wordpress/wp-content/uploads/2021/05/Non-Market-Transfer.pdf
The Company is actively exploring options to facilitate the trading of Adacel shares and is currently evaluating a number of third-party platforms. These platforms would facilitate periodic off-market sale and purchase transactions in Adacel shares, by matching buyers and sellers who register their interest on the platform. However, there is no assurance that there will be sufficient liquidity on any such private share trading platform to allow Shareholders to sell their shares on the platform. While we are not yet able to provide a definitive timeline for when a platform will be operational, we are committed to providing updates on our progress. We will notify all shareholders as soon as a platform is selected and available for use.
The Company will continue to provide shareholders with information about the ongoing activities of the Company including, but not limited to:
- Material Events
- Reviewed Half-Yearly Financial Statements
- Audited Annual Financial Statements
If you have provided your email address to our share registry Boardroom, you will receive this information and other communications directly via email from either Boardroom or the Company directly. Investors are encouraged to ensure their contact information (in particular email address) is up to date with Boardroom. Please visit https://www.investorserve.com.au/ or call 1300 737 760 to do so.
Following a detailed review, the board of directors of Adacel (Board) determined that Adacel’s removal from the Official List was in the best interests of Shareholders for the following reasons:
Limited Trading and Liquidity
Notwithstanding the Company’s ASX listing, trading in the Company’s shares has been relatively illiquid. The Board believes that the current spread of Shareholders does not maintain an orderly and liquid market for trading in ADA shares. In addition, the percentage of the Company’s issued capital held by the Top 20 Shareholders was approximately 66% with the Top 4 holding approximately 48%. This represents a large concentration of shareholdings in only a few Shareholders.
Company Valuation
The Board is of the view that the low trading volumes have had an adverse impact on the share price. To this end, the recent trading price of the shares implies a valuation that has been (and remains) consistently and materially lower than the true value of the business. This has potential to anchor the price at which a prospective exit might be achieved for Shareholders to current trading patterns. The Board is confident that the Company’s valuation has a greater prospect of growing towards the Board’s assessment of fair value as an unlisted company. This is because, as a listed entity, the current soft capital markets for small and micro-cap listed companies negatively affect the Company’s market capitalization and preclude the Company from being valued based on its fundamentals, as would be the case for an unlisted entity.
In addition, the removal of daily “mark to market” pricing of ADA shares would assist those Shareholders for whom daily pricing is not relevant or causes unnecessary fluctuations in their portfolio valuations.
Capital Raising
As an ASX listed Company, the Board had less control over the price at which capital raises were undertaken. If the Company had remained listed and the share price remained low, then there was a risk that any further capital raising that were undertaken to support growth would have been highly dilutive and further reduced the share price. The board is of the view that the Company’s listing on the Official List had limited its ability to raise funds needed to participate in meaningful M&A transactions without being highly dilutive to Shareholders.
The Company believes it can undertake larger, less dilutive capital raisings, in an unlisted environment.
Cost Savings
The Board believes that the ongoing administrative, compliance and direct costs associated with the Company’s ASX listing were disproportionate to the benefits of remaining listed.
Management Time and Effort
A significant portion of the Company’s management time is currently being dedicated to time intensive matters relating to the Company’s ASX listing. A delisting would allow management to spend more time on other value-add matters for the benefit of the Company and its Shareholders.
If you require further information in regard to your shareholding please contact the Company’s share registry, Boardroom:
Phone:
Within Australia: 1300737 760
Outside Australia: +61 29290 9600
Email: enquiries@boardroomlimited.com.au
Other queries can be directed to the Company Secretary by email to nova@jmcorp.com.au
