CFS poised to list despite small hurdles
Consolidated Financial Services (CFS) is scheduled to list by the middle of this month, after its float reached its minimum subscription levels.
CFS director David Craig confirmed the float, which closed on October 29, attracted more than 400 shareholders and raised more than the minimum subscription level of $1.2 million. These minimum figures were needed for a listing, but the company still faces some hurdles before its appearance on the ASX.
Money Managementunderstands that one of the founder shareholders has not signed a deed of variation. The deed, according to the prospectus, allows a minimum exercise price of 20c for founder preference share options, removes the right of preference shareholders to nominate two directors to the CFS board and requires CFS to call a meeting to convert preference shares to ordinary shares if a listing was not achieved before March 1999.
Preference shareholders are those who have applied for shares and the ordinary shares are held by existing CFS directors such as Craig. Some of planners who have joined CFS are also preference shareholders.
Craig confirmed that: "one person hasn't signed the deed of variance", but said he doesn't see this as a problem for listing.
"There are a couple of grey areas that have to be resolved before listing, but they are not big issues and they won't stop it," he says.
A meeting between the ASX and CFS is due to take place this week to resolve the outstanding issues.
While most planner groups that have signed up to use the CFS wrap account are not placing client funds in the wrap account at present, the few planners who are using it have lifted the amount of funds under administration to $120 million.Money Managementhas been told that most planner groups are waiting for the listing before using the service.
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