- Ordinary shares to delist on 14 December 2022
- Investors can swap shares for Nasdaq-listed ADS
- Company urges shareholders to seek financial advice
Global leader in life science research tools Abcam (ABC:AIM) has announced it intends to delist its UK shares by the end of this year.
The delisting, proposed for 14 December, is subject to shareholder approval at a general meeting to be held on 11 November.
The move will result in a single listing for Abcam’s shares on the US Nasdaq market, meaning in future the company will be subject to SEC (Securities and Exchange Commission) listing rules and UK listing rules will no longer apply.
WHY ARE THE SHARES BEING DELISTED?
The company believes concentrating its efforts on the US market will provide more liquidity for the shares as well as giving the company access to a deeper pool of capital.
Over the last year, the average daily volume in Abcam’s US-listed shares (which joined Nasdaq in October 2020) has represented around 24% of total liquidity, despite only accounting for 14% of total shares, demonstrating greater liquidity.
The firm also believes a sole listing will reduce the costs and ‘complexities’ involved in dealing with two listing regimes.
Finally, the company believes a sole Nasdaq listing is more appropriate given many of its peers are also listed in the US and therefore the company will continue to attract analyst coverage.
Chief executive Alan Hirzel said: ‘This proposed listing change will make it possible for Abcam to attract more investors to our global business.
‘With the change, we see a path to creating value by increasing stock trading liquidity for our current and potential shareholders.’
The shares dropped 1.5% to £13.23 on today's news and are down 24% year-to-date.
WHAT HAPPENS NEXT
If the proposed resolution is passed at the general meeting, Abcam's AIM-listed shares will continue to trade until the close of play on 13 December 2022.
The company said shareholders who elect to deliver their ordinary shares for delivery of ADSs (one ADS is equivalent to one ordinary share) before the delisting will not incur deposit fees, stamp duty or SDRT (stamp duty reserve tax).
Investors who hold their shares electronically are encouraged to contact their broker to request their shares are deposited.
For shareholders who hold shares in certificated form, the company’s receiving agent Equiniti will ‘facilitate a block transfer process.’
SHOULD YOU SEEK FINANCIAL ADVICE?
Although Abcam argues swapping ordinary shares into ADSs does not constitute a formal sale of shares, it cautions it has not ‘taken steps to confirm the current position with HMRC’.
Therefore, it is advising all shareholders to seek financial advice specific to their own circumstances.
The company continues: ‘Shareholders should be aware that HMRC has not published any detailed guidance on the treatment of 'ADSs' for inheritance tax purposes to date.’
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