2nd Apr 2014 09:20
LONDON (Alliance News) - Rare Earths Global Ltd saw its shares fall sharply Wednesday after it said it will ask shareholders for approval to delist its shares from AIM as part of its efforts to cut costs and because the listing is no longer useful in terms of access to capital.
The company has been hit hard since it listed on AIM in 2012 after China set minimum production targets for separation plants and smelters in China of 2,000 metric tonnes a year and production targets of 20,000 metric tonnes for mixed rare earth mines, more than double the production capacity of Rare Earth's smelting and separation plant.
The company is trying to find a way of meeting the criteria and getting its separation plant operational again, but in the meantime is trying to cut costs and carefully manage its cashflow. Its biggest costs are those related to maintaining its AIM listing.
It said it will hold a shareholder meeting April 22 in Shenzhen China to put the resolution to shareholders. It needs to get approval from at least 75% of the votes cast, but expects trading on AIM to cease at the close of business May 1 if it gets approval.
Rare Earths Global shares were down 78.6% at 15 pence Wednesday morning.
By Steve McGrath; [email protected]; @SteveMcGrath1
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