Shareholders in Amcom Telecommunications Ltd have voted against the buy-back of Futuris Ltd's 18.6 per cent stake, valued at over $19 million.
Shareholders in Amcom Telecommunications Ltd have voted against the buy-back of Futuris Ltd's 18.6 per cent stake, valued at over $19 million.
Shareholders in Amcom Telecommunications Ltd have voted against the buy-back of Futuris Ltd's 18.6 per cent stake, valued at over $19 million.
The vote follows activity last month where Futuris sold the majority of its 50.1 per cent Amcom stake to institutional investors in a bid to reduce its debt position.
At the end of the sell down, Futuris held an 18.6 per cent stake in Amcom, with a proposal then made that Amcom will buy-back and cancel the remaining shares for around $19.5 million, subject to shareholder approval.
Today that proposal was knocked back, with the Amcom board saying it recognised the changed circumstances in global credit markets that have occurred over the last two months.
Futuris said it will now sell its Amcom stake as soon as possible.
Amcom said the decision means that the company will not be required to take on the additional $20 million in debt and will retain its balance sheet strength and low gearing ratio of 14 per cent and high interest cover.
Futuris' stake comprised of 99 million shares at 19.7 cents each.
"Non-recurring costs of circa $1.6 million after tax relating to the completed $28.9 million sell-down and cancelled $19.5 million buy back process have been incurred," Amcom said.
"An annual interest expense saving of $1.8 million will be generated as a result of not having to raise the additional debt."
Meanwhile, Amcom has reaffirmed its guidance for fiscal 2009 earnings befire interest and tax to be at least a 25 per cent increase to the 2008 financial year results.