ITL Health Group Limited (‘ITL’) has today, following a resolution of the Board of Directors, submitted a formal application for the removal of ITL’s fully paid ordinary shares (‘Shares’) from the Official List of Australian Securities Exchange (‘ASX’) pursuant to ASX Listing Rule 17.11.
ITL has obtained in-principle advise from the ASX in relation to the delisting. The ASX has confirmed that upon receipt of a formal request to delist it is likely to remove ITL from the Official List of ASX, subject to ITL complying with certain conditions of which ITL intends to fully comply with. Those conditions are as follows:
- That the company’s removal from the official list of ASX is approved by ordinary resolution of ordinary security holders of the company at an extraordinary general meeting (‘EGM’).
- That the removal from the official list of ASX will take place no earlier than one month after approval is granted at the EGM.
- That the full terms of the decision are advised to the market immediately upon the Company’s directors resolving to seek removal of the Company from the official list of ASX.
Reasons for delisting from the ASX
The key reasons for seeking ITL removal from the Official List of the ASX are:
- Valuation: The Directors of the Group consider that the prices of the securities that are trading on the ASX are significantly and materially lower than the underlying value of the Group, and also of the net assets that these securities represent
- Liquidity: The Directors believe that the liquidity of the shares is insufficient to provide security holders an avenue to redeem their shares now, or in the future
- The financial, administrative and compliance obligations and costs associated with maintaining an ASX listing can no longer be justified. This is particularly the case given the low levels of trading in the security.
- There are a large number of “unmarketable” holdings parcels held, indicating a limited market for trading of the securities
Delisting process and consequences of delisting
The consequences of ITL removal from the Official List of the ASX include:
- ITL Shares will no longer be quoted on the ASX and will no longer be traded on the ASX;
- ITL Shares will only be capable of sale via off-market private transactions which will require ITL shareholders to identify and agree terms with potential purchasers of ITL Shares;
It is the company’s intention to conduct an unmarketable parcels buyback program before delisting and also to participate in on-market buybacks in order to assist shareholders who may wish to sell their securities pre-delisting.
Subject to formal approval by ASX, ITL current expenses that the Shares will be removed from the Official List by mid-February 2019.