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Be the first with the news that moves the market- Share prices in medical device company GI Dynamics fell 36.8 per cent today after mentioning the prospects of delisting from the ASX in an annual meeting
- The company cited ongoing costs mandated from responsibilities of being listed in the ASX accounting for a loss of $300,000 a year
- The company says the delisting decision would be finalised pending shareholder approval and a decision in cooperation with the ASX’s opinion, but made clear that it is currently not a finalised decision
Share prices in American medical device developers GI Dynamics plummeted 36.8 per cent today after an annual meeting discussed the prospects of delisting the company.
Company management stated the financial position and developmental progress of the company has impacted a decision to delist in the best interest of the company and stockholders, though not finalised.
GI’s main business is currently developing the EndoBarrier, an endoscopically-delivered therapy device worn inside the body for treatment of type-2 diabetes and obesity. The product hasn’t reached approval for sale yet.
“As a result, the company has obtained in-principle advice from the ASX in relation to the potential removal of the company from the Official List,” read the document released today.
According to the document, the largest influence on the decision is the pending of shareholder approval, though the company board has not yet formed a final view on whether to delist or not, only seeking ASX advice.
‘In addition, even if stockholders approve the Delisting proposal at the Annual Meeting, the Board only intends to lodge a Delisting application with the ASX for its final approval if, after further detailed consideration, it believes that the Company should seek a Delisting.’
GI Dynamics management cited ongoing costs from being ASX listed causing a strain on the company. These include fees on lawyers, accountants, printing and mailing.
Management outlined in the media release that these expenses chalk up to $300,000 a year.
Share prices in GID closed last week at 1.90 cents and are currently trading at 1.2 cents a share with an $18.22 million market cap.
