News blog

MCB Finance Group

  • BY: Andrew Hore |
  • POSTED: 27/09/2011 |

Personal credit provider MCB Finance Group is cancelling its general meeting to vote on the proposed cancellation of its Aim quotation because it does not have the support it initially thought it had.

MCB originally said that holders of 55% of the shares would support the cancellation and it thought a further 21% would also support the vote. MCB now says that shareholders owning the majority of the shares will not support the cancellation.

The general meeting will not be held and MCB will continue as it is.

On the day of the announcement of the proposed Aim cancellation the share price slumped 22p to 30p. It has recovered to 36p, valuing MCB at £6m, but it may take some time to repair the damage to the share price.

The original announcement was made on 13 September and on that day 69,374 shares were traded. Trading since then has been thin but there were 700,000 shares traded on 16 September, 725 on 18 September, 1,300 on 22 September, 525 on 23 September and 1,351 on 26 September. Prior to today’s announcement there were two apparent sales – 7,500 shares at 32p and 1,300 shares at 28.7p.

At least some of these share trades are likely to have been due to the fact that there was not going to be a market for the shares after cancellation.

The damage has been done. It is unlikely that the share price will touch 52p in the near future, although the shares are modestly rated and that should attract the attention of some investors. The shares are trading on four times prospective earnings for 2011.

Download the September 2011 edition of AIM Journal at http://www.hubinvest.com/AIMPDFSeptember2011_24.pdf

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