Built-environment recruiter Prime People is to reorganise its share capital.

The company says this will reduce the significant number of small shareholders that exist in the company, and reduce the cost to the company of maintaining its share register. 

The company announced poor annual results yesterday, with profits before tax dropping to £730,000 for the year ending 31 March 2009, compared with £2.43m in 2008 (recruiter.co.uk, 8 June).

The reorganisation will also provide the opportunity for those shareholders to dispose of their shares without incurring disproportionately high dealing costs.  

In a statement to the Stock Exchange, the AIM listed (Alternative Investment Market) property recruiter says: “The company has roughly 600 shareholders, over 50% of whom hold fewer than 500 ordinary shares. 

“The effect of the proposed capital reorganisation is that shareholders holding 500 or fewer ordinary shares on 7 July 2009 will receive a cash payment equivalent to the market value of their shares, as represented by the closing middle market price on AIM on 8 June 2009 of 21p for each ordinary share which they held.

“The board of directors has, therefore, made arrangements to give the holders of small shareholdings cash in consideration for their ordinary shares without those shareholders incurring dealing charges.

“The directors anticipate that the capital reorganisation will reduce the number of shareholders from the present level of around 600 to around 250. This will reduce the company’s costs on an ongoing basis.”