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Date: 27 June 2008
PULSE GROUP PLC (Ticker PGRP)
TRADING ON THE PLUS-QUOTED MARKET
Pulse Group plc ("Pulse" or the "Company") is pleased to announce that its
ordinary shares have today been admitted to trading on the PLUS-quoted market.
SUMMARY DETAILS
Sector classification: Media Sector
Principal Activities: The Company is a holding company, whose wholly owned
subsidiary, Pulse BPO (together the "Pulse Group"), is a leading provider to
the global market research industry of independent online and offline fieldwork
in the Asia-Pacific region
Admission Date: 27th June 2008
Number of share in
Issue and admitted
to trading 91,638,888
Total held by Directors 54,028,609 (58.96% of issued share capital)
Market Capitalisation
at the placing price of
10p per share 9,163,888
Corporate Adviser: Whim Gully Capital LLP ("WGC")
Tel. +44 (0) 1488 608877
BUSINESS ACTIVITY AND CORPORATE STRATEGY
PRINCIPAL ACTIVITY
The Pulse Group is a leading provider of research process outsourced ("RPO")
services within the Asia-Pacific region predominantly to market research and
media companies, based anywhere around the world, wishing to conduct research
within the region. It also provides its services to RPO companies based in
other parts of the world who have a need to conduct research within the
Asia-Pacific region. Pulse is not itself a market research company and rarely
has contact with the end user of the research material that it generates. The
majority (approximately 82.7%) of the projects undertaken by the Group are of
an ad hoc nature, with a significant proportion of these being carried out as
repeat business from established customers. The remaining projects
(approximately 17.3%) fall into the trend analysis category with data being
gathered on an agreed number of occasions over a specified period.
As an integral part of its service offering and to provide a high degree of
comfort as to the quality of the process being undertaken, the Group enables
its customers and the end users of the research material being gathered to have
online, real time access to the data as it is being collected from the
panellists selected to participate in the project in question.
PRODUCTS / SERVICES
The services and activities offered by the Pulse Group in fulfilling its
clients' market research requirements include:
- Questionnaire translation - Provides translation services enabling the
translation of surveys from its original language into any language desired.
- Questionnaire programming - Provides questionnaire scripting services to
clients utilising major market research programming software.
- Data collection - Enables survey response data to be collected either:
- Online:
The principal method used for the collection of data online is;
CAWI (Computer aided web interviewing) - Market research questionnaires are
distributed and response data is gathered via the Internet using the Pulse
Group's custom developed proprietary software suite. Should for any reason the
profile of Pulse's own panellists not match that required by the customer for
the particular type of research being performed, it is able to utilise
established relationships with external online communities to access a wider
range of panellists; or
- Offline:
The two principal approaches used to collect data offline are;
CATI (Computer aided telephone interviewing) - Market research data is gathered
via telephone interviewing, utilising an in-house 22 seat VOIP call centre
manned by individuals fluent in the language of the target country. The
principal focus is on conducting B2B interviews but there can also a demand for
CATI where;
- Internet penetration in the target country is relatively low. This includes
Thailand, Vietnam and the Middle East; and/or
- the targeted respondent profiles are poorly represented by online panellists.
Such profiles might include senior corporate executives, affluent individuals
and the elderly.
The Group proposes to set up other VOIP CATI centres by the end of 2009.
Qualitative - Direct interviewing, normally using a smaller sample size, that
results in the gathering of qualitative rather than quantitative data. The
methodology is common with any research programme, and hence an ideal service
to complement the Pulse Group's core online services. The Pulse Group manages
two physical focus group facilities in Malaysia and also has the ability to
recruit, interview and analyse qualitative results via an online focus group
and an online bulletin board software solution.
- Data processing and data analysis - Provides data processing and analysis to
the clients' specifications.
Online Panels
Online panels are generally regarded as the "industry standard" method for
conducting robust and reliable survey data collection via the Internet. The
Group currently has some 340,000 of its own or proprietary panellists, each of
whom has been through a personal profiling process, and interaction with these
panellists takes place via the Group's own portal known as Planet Pulse (
www.planet-pulse.com).
STRATEGY FOR GROWTH
The Directors' objective is to develop the Group into a substantial and highly
profitable business within the medium term. They believe that significant
progress has been made since the incorporation of Pulse BPO and that the Group
has already established a leading position in a fast growing market sector
within a rapidly developing region. The Directors intend to pursue a number of
initiatives to grow the Group's business both organically and by making
suitable acquisitions, a number of which have already been identified. These
initiatives include:
- Panel expansion - The Group is aiming to significantly increase the size of
its proprietary panels. The Directors believe that this can be achieved by
pursuing the established recruitment methods outlined previously. It is their
belief that an increase in the proprietary panel size will enable the Group to
attract more customers and to generate more revenue. The Group will also seek
to strengthen its existing panels in certain niche markets, specifically China,
Vietnam, Thailand, Indonesia, Philippines and the GCC countries in the Middle
East. This will be achieved both through organic growth of the panels and by
acquisitions.
- Triangulation - Whenever business is conducted with a branch or division of a
customer with other geographical locations, a conscious effort is made to
advise those other locations of the relationship that has been established and
to encourage them to also make use of the Group's services.
- Establish a 24 hour worldwide operation - Existing technology allows senior
members of staff to generate project quotations and to devise and launch
projects remotely from any geographical location in the world. The Group has
already established a number of business development offices serving customers
in different time zones and it is the Directors' intention to increase the
number of these offices so that eventually the Group's business will become
operational and revenue generating 24 hours per day.
- Innovation - In the future the Directors intend to launch a white label
service offering that would allow certain key market research customers
licensed access to Pulse DNA. This would enable them to generate their own
project costings and even to launch and manage their own projects.
- Acquisitions - Consideration will be given to acquiring existing business
that are already profitable and that enable the Group to establish or
strengthen its presence in certain target locations. A number of suitable
targets have already been identified.
DIRECTORS AND THEIR FUNCTIONS
Bob Chua, aged 34; Chairman and Chief Executive Officer
Bob Chua, has been involved in the market research industry throughout his
career, working for large market research companies including Nielsen and TNS.
Throughout this time, Bob Chua has been exposed to the forefront of technology
within the market research sphere and has created several strategic ventures
such as ACNielsen Online, and TNS Interactive. He also sits on the ESOMAR
Committee of Online Panel Guidelines which is a task force to ensure strict
standards for online research globally. Bob Chua has been with Pulse BPO since
its incorporation and was appointed a director of the Company on 1 October
2007. He is responsible for the overall management and growth of the Pulse
Group. He holds a double degree from Griffith University, Australia in
Information Technology and Business Administration.
Kym Wong, aged 40; Chief Operations Officer
Kym Wong has been an international marketing practitioner for over thirteen
years. He has served in senior management roles in both private and public
companies in the property development, manufacturing, aviation and professional
sports industries. Kym Wong has also been responsible for setting up strategic
business units for a number of companies he has served. Kym Wong has been with
Pulse BPO since its incorporation and was appointed a director of the Company
on 1 October 2007. He holds the operations portfolio with special emphasis on
making the Pulse Group the leading RPO provider of choice to the market
research industry. He graduated with a Dip. In Law, University of
Wolverhampton, UK.
Lim Tze Wye, aged 40; Chief Financial Officer
Lim Tze Wye joined the Pulse Group as CFO and has been a director of the
Company since 1 October 2007. He is responsible for overseeing all financial,
investor relations, and merger and acquisition activities of the Pulse Group.
Lim Tze Wye holds a Bachelor of Commerce and Administration from Victoria
University of Wellington, New Zealand. Lim Tze Wye commenced his career with
Coopers and Lybrand where he qualified as a Chartered Accountant and has over
fifteen years' experience in the areas of finance, management and corporate
operations throughout various industries.
Bill Pegram, aged 62; Non-Executive Director
Bill Pegram was appointed a director of the Pulse Group on 16 November 2007 and
is a member of the Company's Remuneration Committee and Audit Committee. Mr.
Pegram has worked in the market research industry for 40 years. His career
began with Lintas and subsequently with Research Bureau Limited, both of which
are subsidiaries of Unilever. In 1982 he and a colleague left to create Pegram
Walters Associates, which was to become one of the UK's leading independent
research agencies. In 2001 he sold the business to Aegis plc and the agency
became the first European company in Synovate, the newly created research
subsidiary of Aegis. In four years Synovate had grown to become the sixth
ranked global research company. For four years Mr. Pegram was Corporate
Development Director, responsible for mergers and acquisitions in Western
Europe. He set up Bill Pegram & Co in 2006 and now works as a management
consultant to the research industry. A senior industry figure, Mr. Pegram is a
Fellow of the Market Research Society and full member of ESOMAR.
Hideaki Fujiyama, aged 35; Non-Executive Director
Hideaki Fujiyama has been a director of Pulse BPO since 22 August 2007 and was
appointed to the Board on 1 October 2007. He is a member of the Company's
Remuneration Committee and Audit Committee. He has ten years experience in
venture capital financing, project financing and corporate financing. He joined
the Industrial Bank of Japan in 1997 and was in charge of its airline division.
He was engaged in numerous international energy sector projects in Sri Lanka,
Bangladesh and Vietnam at Japan Bank for International Cooperation. After
joining Japan Asia Investment Company Ltd. in 2004, he was in charge of a fund
investing in small to medium size companies in Japan and throughout South-East
Asia. He graduated with a BA Economics at University of Kyushu, Japan and MA
Human Environment Studies at University of Kyushu, Japan.
Following Admission the Company intends to appoint an additional suitable UK
based non-executive director with public company experience.
ADDITIONAL INFORMATION ON THE DIRECTORS
In addition to directorships of the Company, the Directors hold or have held
the following directorships or have been partners in the following partnerships
within the five years prior to the date of this document:
Director Current Directorships/ Past Directorships/
Partnerships Partnerships
Bob Chua Pulse BPO Sdn. Bhd. Nil
Kym Wong Pulse BPO Sdn. Bhd. Nil
Lim Tze Wye None Virgo Pulse Sdn. Bhd.
Vickers Hoskins Holdings Bhd.
Vickers Hoskins International
Trading Limited
Vickers Hoskins (M) Sdn. Bhd
Bill Pegram GRC Holdings Limited Synovate Limited
Hideaki Fujiyama ISCM Technology Co. Limited Pulse BPO Sdn. Bhd.
Soon Soon Oilm ills Sdn Bhd
SUBSCRIPTION BY EVOLVE CAPITAL PLC ("Evolve")
Evolve is an investment company listed on AIM with the specific objective of
investing in PLUS-quoted companies or companies intending to seek a listing on
PLUS-quoted.
Evolve had provided the Company with a convertible loan of �400,000. This Loan
has now been converted into 8,888,888 new ordinary shares at a conversion price
of 4.5p per share.
In addition Evolve has subscribed for 1,000,000 new ordinary shares of 1p each
at a placing price of 10p per share.
These shares, in aggregate totalling 9,888,888, represent 10.79% of the issued
share capital of the Company at Admission. These shares have been issued and
credited as fully paid and rank pari passu in all respects with the other
81,750,000 ordinary shares.
As a consequence of the Loan and of the subscription the Company has raised �
500,000 of new funding before expenses. The funds raised will be used to pay
the costs of admission together with certain outstanding costs in connection
with the Company's previous aborted AIM application and to increase the size of
its proprietary panels.
Edward Vandyk and Oliver Cooke of Whim Gully Capital are both officers of
Evolve and together hold approximately 12 per cent. of its issued share
capital. Edward Vandyk is an Executive Director of Evolve and holds 5,250,001
shares, which at the date of this announcement equates to 11.35 per cent. of
the issued share capital of Evolve. Oliver Cooke is the Company Secretary of
Evolve and holds 250,000 shares, which at the date of this announcement equates
to 0.54 per cent. of the issued share capital of Evolve.
In light of Whim Gully Capital's relationship with the Company, Edward Vandyk
and Oliver Cooke took no part in Evolve's decision to invest in the Company.
REASONS FOR THE LOAN, THE PLACING AND ADMISSION
The Company requires funds to allow the Pulse Group to increase the size of its
panels and to investigate and pursue potential acquisitions as referred to
above. The Directors believe that the Placing and the Loan were the most
appropriate method of securing such funds and believe that Admission offers the
following benefits:
* availability of publicly traded shares - the Directors believe the issue of
publicly traded shares as consideration for any acquisition will be more
attractive to potential vendors than shares in a company which are not so
traded;
* future capital requirements - the Directors believe that Admission will
enable the Company to access capital at later dates more effectively than
if it were an unquoted company;
* increased corporate profile - the Directors believe that the status of
being a company whose shares are traded publicly could benefit any
businesses to be acquired by increasing their profile with customers and
suppliers; and
* incentivisation of key staff - the opportunity to own and retain shares and
incentivise staff through the use of share options in respect of publicly
traded shares.
SHARE OPTIONS
The Company has adopted a Share Option Plan to assist in the recruitment,
retention and motivation of key executives and employees of the Group. Under
the Share Option Plan the Company has granted share options, subject to vesting
conditions, to three Directors over 3,841,583 ordinary shares, in aggregate
representing approximately 4.19 per cent. of the Enlarged Share Capital. In
addition, the Company has granted options over 229,097 ordinary shares to Bill
Pegram pursuant to an option agreement between the Company and Mr. Pegram.
SUBSTANTIAL HOLDINGS
The interests of the Directors and persons connected with them (within the
meaning of section 252 of the 2006 Act), (all of which are beneficial save
where otherwise stated) in the share capital of the Company immediately
following Admission are as follows:
Number of Percentage of
ordinary shares issued share
immediately capital
following immediately
Admission following
Admission
Bob Chua 37,820,026 41.27
Kym Wong 16,208,583 17.69
Lim Tze Wye Nil -
Bill Pegram Nil -
Hideaki Nil -
Fujiyama
JAIC* 27,721,391 30.25
Evolve 9,888,888 10.79
Total 91,638,888 100
* Japan Asia Investment Corporation
In addition the Directors hold the following share options.
Number of Exercise price Latest exercise
ordinary shares date
under option
Bob Chua *1,617,000 10p 26 June 2018
Kym Wong *850,000 10p 26 June 2018
Lim Tze Wye 1,374,583 10p 26 June 2018
Bill Pegram 229,097 10p 26 June 2018
Hideaki Nil - -
Fujiyama
Total 4,070,680
* 1,167,00 of Bob Chua's options and 500,000 of Kym Wong's options are subject
to achievement by the Company of normalised profit after tax of US$ 1 million
in year to 31 May '09.
LOCK-IN AND ORDERLY MARKET ARRANGEMENTS
At Admission the Directors and JAIC were interested in an aggregate of
81,750,000 ordinary shares representing 89.21 per cent of the enlarged share
capital.
Certain Directors and JAIC have undertaken to Whim Gully Capital and to the
Company not to dispose of any of his or its ordinary shares (subject to certain
limited exceptions) within 12 months of Admission. For a period of 12 months
thereafter they have each undertaken neither to sell, nor to dispose of, any of
their ordinary shares other than through the Company's broker from time to time
(subject to certain limited exceptions).
RISK FACTORS
An investment in the Company and the Ordinary Shares described in this document
is speculative, involves a high degree of risk and may result in the loss of
all or part of the investment. Shareholders and prospective investors should
consider in particular the following risk factors before making a decision to
invest in the Company and understand that these risks, individually or in
aggregate if they actually occur, could have a material adverse effect on the
Company, the Pulse Group, its business, financial conditions, capital
resources, results or future operations and/or holders of its securities. In
such a case, the price of the Ordinary Shares could decline and investors may
lose all or part of their investment.
Moreover, the information set out below does not purport to be an exhaustive
summary of the risks associated with an investment in the Company. Additional
risks and uncertainties of which the Directors are not currently aware, or
which the Directors do not currently consider to be material, may also have an
adverse effect on the Pulse Group. These risks could arise as a result of
changes in the market, economic conditions and/or in legal, regulatory or tax
requirements or other unforeseen circumstances or factors.
If you are in any doubt about the action you should take, you should consult a
personal adviser authorised under the Financial Services and Markets Act 2000
who specialises in the acquisition of shares and other securities. A
prospective investor should consider carefully whether an investment in the
Company is suitable in the light of his, her or its personal circumstances and
the financial resources available to him, her or it.
In particular, prospective investors should consider the following:
Company specific risks
Future prospects
The Pulse Group's future prospects will depend on numerous factors, including
its ability to maintain and expand its penetration of the markets in which it
operates. The Company cannot predict accurately the timing and amount of the
Pulse Group's capital requirements. If its capital requirements vary materially
from its plans, the Pulse Group may require further financing sooner than
anticipated. Market conditions may prevent additional funds from being raised
which could restrict the development of the Pulse Group.
The value of an investment in the Company is dependent upon the Pulse Group
achieving its strategic aims. Whilst the Directors are optimistic about the
prospects for the Pulse Group, there is no certainty that the business will be
capable of achieving the anticipated revenues or growth.
Future profitability is not guaranteed. There is no guarantee that the business
or operating strategies of the Pulse Group will sustain profitability or that
it will generate sufficient revenues to cover its costs. The Group is in a
relatively early stage of development in a new and rapidly evolving market.
Attendant risks and potential difficulties include, but are not limited to, the
fact that the Pulse Group's business is at a growth stage and that it utilises
relatively new models. In addition, the Pulse Group currently derives more
revenue from sample only business than full service business which is more
susceptible to pricing pressure.
Competition
The Group operates in a competitive environment, with potentially intense
competition in the future from other market research data collection firms.
Many of the Pulse Group's current and potential competitors have longer
operating histories, larger databases of panellists, greater brand recognition
and significantly greater financial and other resources than the Pulse Group
does. As a result, these competitors may be able to undertake more extensive
sales and marketing campaigns offering their services, adopt more competitive
pricing policies and make more attractive offers to potential employees,
strategic partners, panellists and customers than the Pulse Group can. In
addition, these competitors and potential competitors may develop technologies
that are superior to the Pulse Group's, or that achieve greater market
acceptance or cost savings than its own. If the Pulse Group does not
successfully compete with these competitors, it might experience a loss of
market share, reduced revenues and/or profitability.
Some of the Pulse Group's clients or potential clients may decide to provide
their own Internet-based market survey and data collection services in-house.
Should some or all of these clients decide to build their own Internet-based
panels and succeed in so doing, their need for the Pulse Group's products and
services could be reduced or eliminated. Consolidation in the market research
industry may result in fewer potential clients for the Pulse Group if groups
decide to service all their needs intra-group.
Contracts
The Pulse Group generally has no contracts of a long-term nature with its
clients. Consequently there is no guarantee of minimum levels of revenue or
work. A lack of repeat business and contractual uncertainty could result in
reduced or a total lack of future sales and/or profitability.
Dependency on panels
The Pulse Group's operations are dependent on its ability to recruit, maintain
and rapidly communicate with a sufficient number and variety of active
panellists. Panellists are volunteers, and there is no guarantee that
sufficient numbers of active panellists can be recruited or retained. The risk
that the Pulse Group is unable to maintain sufficient active panellists will
increase as its business expands. It may become necessary to increase the value
of the incentives offered to panellists or its dependency on partners, which
may in turn reduce the Pulse Group's overall profitability and any perceived
advantage over more traditional methods of data collection.
Dependency on technology
The Pulse Group relies heavily on technology for the delivery of its services
to its clients as well as managing all aspects of its operations.
Communication with panellists is via Internet connections. If these connections
are interrupted or cease to be available, or the Pulse Group's technology
connecting it to the Internet is interrupted or ceases to operate, there is
likely to be a significant adverse affect on the Pulse Group's business.
New or improved existing spam-filtering and/or blocking software may interrupt
or prevent the Pulse Group from communicating with panellists.
The Pulse Group's technology infrastructure is potentially vulnerable to
physical or electronic break-ins or attack. If the Pulse Group's security
measures are circumvented or breached, a third party could gain access to the
identity and other confidential information regarding the Pulse Group's
panellists and could misappropriate this information or interrupt its
operations. As a result, the Pulse Group may be required to expend financial
and other resources to protect against the threat of security breaches or to
alleviate problems caused by these breaches. Security breaches could also
damage the Pulse Group's reputation and expose it to liability. These increased
expenditures and/or liabilities could harm the Pulse Group's business and/or
profitability.
Technological changes
The Internet-based market research data collection industry in the Asia-Pacific
region is developing and fast moving. The Pulse Group needs to continue to
effectively develop and integrate various software programs, technologies and
methodologies to enhance and improve its products and services. Software
development and enhancement can be expensive and incur unexpected delays and
expenses, which could adversely affect the Pulse Group. The Pulse Group's
expertise in software development management may be an issue for future
development depending on the complexities of how the software is currently
written.
The development and enhancement of the Pulse Group's IT hardware carries a
degree of complexity for which the existing technical environment may be
insufficient. There is a risk that service availability may be disrupted as a
result.
The Pulse Group's expansion strategy requires upgrading of disk capacity as the
existing storage infrastructure is expected to be filled within twelve to
eighteen months. There is a risk that service availability may be disrupted as
a result.
If the Pulse Group fails to anticipate or respond adequately to technological
developments or customer needs, or if the Company experiences any significant
delays in meeting these requirements, the Pulse Group may not be able to
sustain or grow its business.
Damage to brand or reputation
The Pulse Group is building a brand and reputation which assists in the ability
to generate leads and the sale of its products and services. There is a risk of
potential damage to the brand or the Pulse Group's reputation, as a result of
the actions of competitors, clients, consumer groups or governmental
authorities who may assert claims about the Pulse Group, its products, its
sales channels or its methods of lead generation.
Key personnel
The Pulse Group's success depends to a significant extent on the continued
services of its core senior management team and being able to attract and
retain new senior personnel. The Pulse Group's business may be disrupted,
additional cost may be incurred or the future of the Pulse Group may be
jeopardised by a loss of or failure to retain sufficient numbers and quality of
senior personnel.
Growth in the business
The Pulse Group is projecting considerable future growth in its business. To
achieve this growth in an efficient and timely manner, the Pulse Group will
have to maintain close co-ordination among its sales, support, marketing and
development departments and maintain adequate control systems. The Pulse Group
is also considering expansion into new markets.
If the Pulse Group cannot manage successfully its anticipated future growth,
its costs may increase, its growth could be impaired and it may not accurately
anticipate and fulfill market demand for its products. This could result in a
loss of revenues and profits.
Data protection
Many countries have implemented legislation which places limitations on the
collection, processing, use, re-use and transfer of personal information. As a
result, information that the Pulse Group receives may be subject to limitations
on re-use, transfer and disclosure and the Pulse Group's information gathering
and disclosure practices may be restricted by such legislation. Existing and
potential future privacy laws may limit the ability of the Pulse Group to make
use of data gathered. Any violations (from those of a minor and purely
technical nature to those of a major and substantive nature) could expose the
Pulse Group to significant liability (including restrictions being imposed on
the Pulse Group's use of data gathered or, for serious violations, destruction
of the Pulse Group's databases).
Foreign currency risk
The Pulse Group has customers in many countries around the world and currently
has offices in Malaysia, the United States, Australia, UK and India with plans
to establish additional offices. While there is a potential for foreign
currency risk for the Pulse Group's business, the Pulse Group endeavours to
ensure that most customer contracts are entered in United States dollars. The
Pulse Group incurs operational costs in Ringgit Malaysia, as well as United
States Dollars and other currencies. There is a risk that an adverse movement
in foreign currency rates could adversely affect the Pulse Group's revenues,
expenses and profits.
Past performance not an indicator of future performance
The Pulse Group has only been in existence for a short period. Pulse BPO has
been profitable in each year since incorporation. Past performance is not an
indicator or guarantee of future performance and the Pulse Group may not
achieve profitability in the future.
General risks
The activities of the Pulse Group are also subject to current and future
commercial risks and factors such as economic, political or social conditions
which may generally affect the Pulse Group's ability to generate income or
achieve its objectives or prevent the implementation of its business or
strategic plans.
Trading and liquidity in the ordinary shares and PLUS
An investment in the Ordinary Shares is highly speculative and subject to a
high degree of risk. The price of publicly quoted securities can be volatile
and is dependent upon a number of factors, some of which are general market or
sector specific and others that are specific to the Pulse Group. Only those who
can bear the risk of the loss of their entire investment should invest.
Application has been made for the Ordinary Shares to be traded on PLUS-quoted.
PLUS-quoted is a market designed primarily for emerging or smaller companies.
The Ordinary Shares will not be quoted on the Official List. The PLUS Rules are
less demanding than those of the Official List. Investments in shares admitted
to PLUS-quoted carry a higher degree of risk than investments in shares quoted
on the Official List. Neither the PLUS Markets nor the UK Listing Authority
have examined this document for the purposes of the Admission.
Notwithstanding the fact that an application will be made for the Ordinary
Shares to be traded on PLUS-quoted, this should not be taken as implying that
there will be a "liquid" market in the Ordinary Shares particularly as, on
Admission, the Company will have a limited number of Shareholders. An
investment in the Ordinary Shares may therefore be difficult to realise. In
addition, the price at which the Ordinary Shares will be traded and the price
at which investors may realise their investment will be influenced by a large
number of factors, some specific to the Pulse Group and its operations and some
which may affect quoted companies generally.
The market for shares in smaller public companies, such as Pulse, is less
liquid than for larger public companies. Pulse Group is aiming to achieve
capital growth and, therefore, Ordinary Shares may not be suitable as a
short-term investment; prospective investors should not consider such purchase
unless they are certain they will not have to liquidate their investment for an
indefinite period of time. The share price may be subject to greater
fluctuation on small volumes of shares, and thus the Ordinary Shares may be
difficult to sell at a particular price. The value of the Ordinary Shares may
go down as well as up. The market price of the Ordinary Shares may not reflect
the underlying value of the Pulse Group's net assets. Investors may therefore
realise less than their original investment or sustain a total loss of their
investment.
Force majeure
The Pulse Group's operations now or in the future may be adversely affected by
risks outside the control of the Pulse Group including labour unrest, civil
disorder, war, subversive activities or sabotage, fires, floods, explosions or
other catastrophes, epidemics or quarantine restrictions.
General economic conditions
Market conditions may affect the ultimate value of the Company's share price
regardless of operating performance. The Group could be affected by unforeseen
events outside its control, including, natural disasters, terrorist attacks and
political unrest and/or government legislation or policy. Market perception of
market research companies may change which could impact on the value of
investors' holdings and impact on the ability of the Pulse Group to raise
further funds by an issue of further shares in the Company. General economic
conditions may affect exchange rates, interest rates and inflation rates.
Movements in these rates may have an impact on the Pulse Group's profitability
or cost of raising funds.
Insurance risk
The Pulse Group has indemnity insurance to protect its assets and employees.
However, the insurance coverage may prove difficult to renew or inadequate to
satisfy potential claims and losses. Further, the Pulse Group may become
subject to liabilities that cannot be insured against or against which it may
elect not to be insured fully or at all because of high premium costs.
Taxation risk
Any change in the Pulse Group's or any member of the Pulse Group's tax status
or the tax applicable to holding Ordinary Shares or in taxation legislation or
its interpretation, could affect the value of the investments held by the Pulse
Group, affect the Company's ability to provide returns to Shareholders and/or
alter the post-tax returns to Shareholders. Statements in this document
concerning the taxation of the Pulse Group and its investors are based upon
current tax law and practice which is subject to change.
Pulse BPO currently holds MSC status in Malaysia which enables it to operate on
a tax free basis subject to certain terms and conditions. One of these
conditions is that its operations are conducted within a designated enterprise
zone. Presently Pulse BPO's principal operations are located outside of the
designated zone and, following discussions with the appropriate authorities,
Pulse BPO has given an undertaking to relocate its call centre operation into
the designated zone, which action is considered by the Company to be sufficient
for Pulse BPO to maintain its MSC status. While Pulse BPO therefore expects to
continue to maintain its MSC status, there is a risk that this status may be
affected or that the Malaysian government may withdraw or not renew the MSC
status, such that profits of Pulse BPO would then become taxable. This would
adversely affect the profits of the Company.
Litigation risk
Legal proceedings may arise from time to time in the course of the Pulse
Group's business. The Company cannot preclude the possibility that litigation
may be brought against it or other companies in the Pulse Group.
Legal systems and change of legislation
There is various legislation which affects the way in which the Pulse Group
operates its business and provides its market research services. This
legislation restricts the method of contacting potential panellists as well as
the manner in which information is stored and used. There is a risk that a
change in legislation could adversely restrict these or any other activities of
the Pulse Group and impact the Pulse Group's operations and hence impact its
revenues and profits.
Some of the countries the Pulse Group may operate in could have legal systems
that are not as developed as, or different to those in the UK. This could
result in risks such as: (i) potential difficulties in obtaining effective
legal redress in the courts of such jurisdictions, whether in respect of a
breach of law or regulation, or in an ownership dispute; (ii) a higher degree
of discretion on the part of governmental authorities; (iii) the lack of
judicial or administrative guidance on interpreting applicable rules and
regulations; (iv) inconsistencies or conflicts between and within various laws,
regulation, decrees, orders and resolutions; (v) relative inexperience of the
judiciary and courts in such matters; and (vi) difficulty in the interpretation
and enforcement of licenses and other contracts. In certain jurisdictions the
commitment of local business people, government officials and agencies and the
judicial system to abide by legal requirements and negotiated agreements may be
more uncertain.
There can be no assurance that joint ventures, licences, licence applications
or other legal arrangements will not be adversely affected by the actions of
government authorities or others and the effectiveness of and enforcement of
such arrangement in these jurisdictions cannot be assured.
Economic and political risks
It is anticipated that the majority of the Pulse Group's activities will be
outside the UK and, there are a number of risks over which it has little
control. Whilst the Pulse Group will make every effort to ensure it has robust
commercial agreements covering its activities, there is a risk that the Pulse
Group's activities may be adversely impacted by economic and political factors
such as the imposition of additional taxes and charges or costs or expenses,
cancellation or suspension of licences, expropriation, war, terrorism,
insurrection and changes to laws governing mineral exploration and operations.
There is also the possibility that the terms of any licence the Pulse Group
holds (including any favourable tax provisions) may be changed.
CLASSES OF SECURITY
The nominal value of each ordinary share is 1p and the placing price of 10p per
share represents a premium of 9p over the nominal value. Immediately following
Admission there were 91,638,888 ordinary shares in issue giving the Company a
market capitalisation of GBP 9,163,888 at the placing price.
Full details are set out in an admission document which is available free of
charge to the public during normal business hours on any weekday (except
Saturdays, Sundays and public holidays) from the registered office of the
Company and from the offices of Field Fisher Waterhouse LLP, 35 Vine Street,
London, EC3N 2AA from the date of Admission, for not less than one month
thereafter. The admission document is also available for download from the
Company's website at www.pulse-group.com.
Contacts
Pulse Group plc Bob Chua
Kym Wong
Tze Wye Lim +60 3 2167 6666
Whim Gully Capital LLP Edward Vandyk
Oliver Cooke +44 (0) 1488 608877
The Directors of Pulse Group plc take responsibility for this announcement
END
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