Baltimore cleans house, plans de-listing

Cost cutting

Baltimore Technologies has embarked on a series of housekeeping exercises, but the former security firm has given no indication of its plans for the future.

The company has organised a general meeting of shareholders for mid-December, to approve a plan to consolidate its share structure. The company currently has 40,000 shareholders, 24,000 of whom own less than 125 shares. At the current share price, 125 shares are worth around £22. To cut the cost of servicing these shareholders, old shares will be combined in a new share, at a ratio of 125 to one. Anybody who owns less than 125 shares will be paid the value of their shares and will cease to be a shareholder. American Depository Shares (ADS), which allow people to trade Baltimore's shares on the US markets, will be worth 1/625th of a share.

The company will also cancel its stock market listing in London and remove itself from the US ADR system. A stock market listing might complicate potential plans to sell the company, it says.

"The board does not believe that, in the company's current situation where it is essentially a cash shell, it is in the company's best interests to incur the costs involved in maintaining such a listing," Baltimore said in a statement.

The announcements come after Baltimore's whole slate of directors - who were responsible for a painful asset sell-off process - were removed due the efforts of a outspoken shareholder, Acquisitor Holdings. The proxy battle between the two sides saw Acquisitor accuse Baltimore's caretakers of destroying shareholder value, while Baltimore's board complained that Acquisitor had no firm plans for the company's future.

In other comments in Thursday's announcement, Baltimore said it is asking UK courts to force Earthport to lodge security to defray the legal costs arising from Earthport's £13m lawsuit against Baltimore, which was filed earlier this year. It is not backing down in face of Earthport's claims of fraudulent misrepresentation, negligent misstatement and breach of contract, saying that they are "inadequately particularised" and "without merit."

© ENN

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