The company’s technology measures the composition and quality of bulk materials as they pass through its analysers – which are designed and manufactured in Adelaide – on conveyor belts.
The company said that delisting from the ASX had several benefits.
Trading volumes have been low for a number of years. In fact the average monthly value of Scantech’s shares traded in the last 12 months has been just $117,485. Meanwhile the average monthly value of shares traded (excluding shares traded by directors) over that time has been $70,704.
In just the past three months, the total value of shares traded has been a mere 84,000 and their value has totalled $42,977. Over that time there have been just 11 days on which Scantech shares have been traded.
The company’s average net profit after tax over the past five years has been just over $1.1 million, and the cost of maintaining an ASX listing is significant in this context.
However, the company’s good levels of cash reserves means Scantech thinks it will not need to raise equity in the foreseeable future, while significant numbers of its shareholders hold “small or unremarkable” parcels of shares.
Over the past year, Scantech has suffered significant costs due to what it calls a “fictitious take-over” from a Singapore-based company as announced on September 22 last year.
“This made it difficult for management to win contracts as the company’s competitors have pointed to the company being embroiled in a takeover, which was being played out in the public arena,” Scantech said yesterday.
“As a small listed company with significant cash reserves, the company is at risk of further attempts to destabilise it while it continues to be listed.”
Scantech has also had difficulty in conducting its business over the past four years as its competitors have continued to highlight the fact shareholders have voted down its remuneration report at its past four AGMs dating back to 2011. That effectively means shareholders do not have much confidence in the board.
The board will hold a shareholders meeting on September 15 to approve the delisting. If approved, the delisting would be completed as soon as convenient.
In this case, Scantech will apply to the Australian Securities and Investment Commission for approval to establish a Low Volume Financial Market. That will allow it to provide shareholders and potential shareholders who want to buy or sell shares a cost-effective facility for up to 100 transactions with a total value of not more than $500,000 in any 12-month period.
Scantech also announced yesterday that from today, it will start a four-week on-market buy-back of up to 10% – 1,756,206 – of its issued shares, to give shareholders the chance to “realise their investment” in the company.
