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Group Five announces JSE delisting application

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Group Five Limited have advised shareholders that the company has made the application to the Johannesburg Stock Exchange to delist. The delisting application was approved by the JSE on the 6th of May 2020.

“The purpose of this announcement is to advise shareholders of the rationale and salient dates and times of the delisting” – SENS announcement – ‘GROUP FIVE LIMITED – Delisting announcement’

Rationale for Delisting:

2.1. On 12th March 2019, the board of Directors of Group Five (the “Board” place the Company and its major subsidiary, Group Five Construction (Pty) Limited (“Group Five Construction”) into business rescue (the “Business Rescue”) in accordance with Chapter 6 of the Companies Act, No 71 of 2008 (the “Companies Act”). The Company simultaneously requested the suspension of Group Five’s shares on  the JSE, which suspension was granted by the JSE on the 12th of March 2019 (the “Suspension”).

2.2. In terms of the Business Rescue proceedings, the Board appointed joint business rescue practitioners (“BRPs”) who assumed control of the Company and commenced the preparation of business rescue plans for both Group Five and Group Five Construction in terms of Section 150 of the Companies Act (the “Business Rescue Plans”). The Business Rescue Plans were approved and adopted by creditors on the 11th of September 2019.

2.3. Upon implementation of the approved and adopted Business Rescue Plans, the BRPs do no believe that there is any realistic prospect of there being any residual value available for or attributable to the Company’s shareholders and, consequently, the issued shares of the Company have no value. This was communicated to stakeholders at a meeting of creditors held on the 11th of September 2019 as well as being tabled in the Business Rescue Plan and referenced in the monthly updates provided to the Company’s stakeholders (which monthly updated have been drawn to the attention of shareholders in various SENS announcements).

2.4. In addition, Group Five no longer complies or, will no longer be able to comply with the JSE Listing Requirements in various material respects including:

  • The Company does not have a duly constituted Board following resignations of non-executive directors on the 25th of June 2019 and the resignation of the interim Chief Executive Officer on the 8th of October 2019, with only one non-executive director remaining as well as a Financial Director who is assisting with the Business Rescue;
  • No Board committees are in existence following the resignations set out above and various resignations from key personnel, and therefore Group Five does not comply with the King IV Code on Corporate Governance.
  • The subscribed capital, which includes reserves but excludes minority interests, revaluation assets and intangible assets, amount to an adverse R1.4 billion which is below the threshold of R50 million as prescribed in the JSE listing requirements and;
  • Group Five has been unable to release audited financial results, with the last financial results having been released on the 30th of June 2018 which contained an operating loss of approximately R1.2 billion (including fair value adjustment) and which is below the requirements of an audited profit of at least R15 million before taxation and after taking account of headline earning adjustments on a pre-tax basis.

2.5. Accordingly, the Delisting will be implemented on the dates and times set out in paragraph 3 below.

3. Salient dates and times:

The salient dates and times for the Delisting are as follows:

  • Last day to trade for the Delisting – Tuesday, 9th of June 2020.
  • Record date for the Delisting – Friday, 12th of June 2020.
  • Removal of Group Five Limited listing from the JSE – Monday, the 15th of June 2020.