Firestone Diamonds plc has blamed lack of liquidity on its decision to de-list from the Botswana Stock Exchange and it is looking at options on what to do with local assets. The BSE has granted the application to delist the Ordinary Shares as of Friday 28 February, 2014, which will therefore be the delisting date.
In a note to shareholders, the AIM-listed diamond development company said trading on the domestic bourse has been “negligible”.
“Since listing on the venture capital board of the BSE in June 2011, less than 0.02 percent of the company’s ordinary shares of 1 pence each (“Ordinary Shares”) have moved onto the BSE and, since then, trading on the BSE has been negligible, with 92,828 Ordinary Shares having traded on nine days in 35 separate trades,” the company said.
Firestone added that in the six months prior to the annual general meeting, held on 29 November, 2013, in which the resolution to voluntarily delist from the BSE was proposed, only 1,107 Ordinary Shares have traded, on a single day, at a weighted average value of 0.60 Pula (approximately 4 pence) per Ordinary Share.
“In light of these circumstances, the Directors formed the view that the administrative costs of maintaining the BSE listing are no longer justifiable and, accordingly, Firestone shareholders voted in favour of a delisting from the BSE at the annual general meeting of the Company, held on 29 November, 2013,” it added.
The company’s project in Botswana, the BK11 mine has been under care and maintenance since 2012 and accordingly, Firestone is looking at options of which could include selling the mine.
“The Board is considering various strategic alternatives for its Botswana operation, including disposal or a joint venture, but it recognises that extracting fair value from the asset in the current investor climate could be challenging,” it said.
Firestone will continue to trade in the AIM market, as operated by the London Stock Exchange, under the ticker ‘FDI’.
The company has engaged Imara Capital Securities to manage the Share Sale Facility and interact with Firestone shareholders on the Botswana Share Register who wish to utilise this facility. Another mining company, Iamgold Corp. exited BSE in 2011 citing lack of liquidity.