Rank: Elder Joined: 5/25/2012 Posts: 4,105 Location: 08c
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Quote:1 December 2015
Atlas Development & Support Services Limited
(‘Atlas’ or the ‘Company’)
Kenya Update
Atlas (AIM, NSE: ADSS) announces that it has taken the decision to place its Kenyan subsidiaries into liquidation by way of a Creditors Voluntary Liquidation. The liquidation is only in relation to the Company’s Kenyan subsidiaries and not the holding
company, which is the listed entity. In view of this, it is important to note that the Company will remain listed in Kenya and is committed to advancing its other subsidiaries, which remain operational. The downturn in the oil and gas industry, market adjustments and the failure of certain key clients to settle debts, together with increasing creditor pressure has led to the decision to close Kenyan operations and
focus all of the Company’s administrative functions and activities in Ethiopia for the time being.
This decision will enable the Company to focus its resources and management on the Company’s newly formed industrial division and its joint venture with Orchid Business Group PLC ('Orchid') which is targeting the resources space (in particular potash development and infrastructure projects). For further details on the industrial division please refer to the Company’s announcement dated 19 November 2015 and for details
on Orchid and the joint venture please refer to the Company’s announcement dated 3 November 2015.
The closure of the Kenyan subsidiaries, Ardan Logistics Kenya Ltd, Ardan (Medical Services) Ltd and Ardan (Civil Engineering) Ltd, will improve the group’s overall cost base. Furthermore, despite the closure of the Kenyan business, the Company will
maintain its listing on the Nairobi Securities Exchange and hopes to maximise value for its Kenyan shareholders through the successful expansion in industrial projects and
operations in Ethiopia. The Board believes the opportunity in Ethiopia is highly compelling and offers the Company and its supportive shareholders the best opportunity to build value both in the short and long term.
Chief Executive of Atlas, Carl Esprey said, “With our new focus on the widening opportunity in Ethiopia, we have taken steps to place our Kenyan subsidiaries into
formal liquidation proceedings. Since the downturn in the oil and gas market, we have found that clients are no longer placing a premium on our high quality services and are demanding terms which are not economically viable. In addition to this, late payment by certain operators and increasing creditor pressure in Kenya necessitate and justify this shift at this time to serve the best interest of the long term development of the business and shareholders. We have been focusing on building a strategy to best allocate our existing assets to build shareholder value and are looking forward to capitalising on opportunities within the newly established industrial division and the JV with Orchid, which we believe will bring more consistent revenue to the business and allow us to
best utilise our existing expertise.”
** ENDS ** Pesa Nane plans to be shilingi when he grows up.
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