Messaging International is buying back and cancelling the shares owned by the liquidator of Pacific Continental.
Pacific Continental is the messaging services providerís largest shareholder with a holding of just over 80m shares - equivalent to 33.9% of the company.
Messaging International will pay 0.15936p a share for the stake, making a total cost of £127,500. That compares to a market price of 0.78p. The current share capital is valued at £1.83m. Net cash was £393,000 at the end of June 2011.
Pacific Continental will be granted an option to buy 10m shares at 0.5p each. The option will lapse three years after it is granted or when Pacific Continental is dissolved.
In order to create distributable reserves, Messaging International is cancelling its share premium account.
Messaging International moved into profit in 2010. Revenues grew from £2.27m to £2.9m, while a loss of £33,000 was turned into a profit of £357,000. That was achieved even though R&D spending increased from £367,000 to £483,000. The cash inflow from operating activities was £427,000. One customer accounts for £844,000 (£721,000) of the revenues.
The latest interims show a profit of £170,000 and a cash inflow of £110,000.
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