Proventec plc : - Cancellation of trading on AIM and Notice of GM

Press Release

24 January 2012

Proventec plc

("Proventec" or the "Company")

Proposed cancellation of admission to trading on AIM

Notice of General Meeting

seeking shareholder approval for the cancellation of admission to trading on AIM of its ordinary shares of 10p each ("Ordinary Shares") ("AIM Cancellation").  A circular is today being posted to the Company's shareholders convening a General Meeting to take place at 11am on Thursday 9 February 2012 at 30 Crown Place, London EC2A 4ES to seek such approval ("General Meeting") and explaining the background to the proposed AIM Cancellationand the reasons why the Directors unanimously consider the proposed AIM Cancellationto be in the best interests of the Company and its shareholders as a whole, and why they recommend that shareholders should vote in favour of the proposed AIM Cancellationat the General Meeting ("Circular)".

It should be noted that the Company intends to maintain the listing of its Ordinary Shares (and Loan Notes) on Alternext and the proposed AIM Cancellation will not affect those listings.

The Circular will also be available on the investors' section of Proventec's website accessible at www.proventecplc.com.

significant proportionof the Company's shareholders based in the Eurozone, we believe that the current Alternextlisting can be used for their future trading purposes.  This coupled with the fact that there are significant cost savings to be made from our proposed withdrawal from AIM, lead the Board to recommend shareholders of the Company vote in favour of the resolution to be proposed at the General Meeting."

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For further information, please contact:

Proventec plc

Media enquiries:

Abchurch Communications
Henry Harrison-Topham / Quincy Allan	Tel: [phone]
[e-mail]

The following information is extracted from a circular to Shareholders (the "Circular") expected to be posted today.  Copies of the Circular will be available at the offices of Seymour Pierce Limited (20 Old Bailey, London, EC4M 7EN) upon request.  Definitions used in the Circular apply in this announcement unless the context otherwise requires.

Proposed Cancellation of trading of Ordinary Shares on AIM

and Notice of General Meeting

1.           Introduction

The purpose of this announcement is to explain the background to the proposed cancellation of trading of Ordinary Shares in Proventec on AIM (and the reasons why the Board consider the proposed AIM Cancellation to be in the best interests of the Company and its Shareholders as a whole) and to seek your approval to the proposed AIM Cancellation at the General Meeting to be convened for this purpose.  The Notice of the General Meeting is set out in the Circular.

It should be noted that the Company intends to maintain the listing of its Ordinary Shares (and Loan Notes) on Alternext and the proposed AIM Cancellation will not affect those listings.

Your attention is drawn to paragraph 7 below which contains a recommendation from the Directors that you vote in favour of the Resolution to effect the proposed AIM Cancellation.

2.           Rationale for the AIM Cancellation

2.1         Having undertaken a review of both the advantages and disadvantages of maintaining Admission of the Ordinary Shares to trading on AIM, the Directors have concluded that a proposal to cancel the Admission should be made to Shareholders in a General Meeting.  In reaching the decision to propose this to Shareholders, the Directors have taken the following factors into account:-

2.1.1      given the overall market conditions for small listed companies, the Directors are of the opinion that it is (and will continue to be) difficult for the Company to attract meaningful equity investment through its listing on AIM;

2.1.2      the AIM listing of the Ordinary Shares is not offering investors the opportunity to trade in meaningful volumes or with frequency within an active market;

2.1.3      a significant proportion of the Company's shareholders (many of whom are based outside the UK, often in the Eurozone) have indicated to the Company that they would utilise the Alternext Listing for trading purposes instead of AIM; and

2.1.4      the Directors estimate that annual direct and indirect costs of maintaining the listing of the Ordinary Shares on AIM are at least £140,000.  This estimate includes listing expenses and AIM advisory fees (and excludes (a) any indirect cost savings associated with the considerable amount of senior executive time which is currently spent dealing with the issues related to the AIM listing and (b) the costs of maintaining the Alternext listing (which will continue)).

2.2         Following careful consideration, the Board believes that it is in the best interests of the Company and Shareholders to effect the AIM Cancellation at the earliest opportunity - (and the Company has notified the London Stock Exchange of the proposed AIM Cancellation).  If Shareholders approve the proposed AIM Cancellation, it is anticipated that the last day of dealings in the Ordinary Shares will be 21 February2012 and that the effective date of the AIM Cancellation will be 22 February2012.

3.           Process for AIM Cancellation and principal effects of the proposed AIM CANCELLATION

3.1         In accordance with Rule 41 of the AIM Rules, the Company has notified the London Stock Exchange of the proposed AIM Cancellation.  Under the AIM Rules, it is a requirement that the AIM Cancellation is approved by the requisite majority of Shareholders voting at the General Meeting (being not less than 75 per cent. of the votes cast whether present, in person or by proxy).  Accordingly, the Resolution seeks Shareholders' approval to the AIM Cancellation.  Subject to the Resolution approving the AIM Cancellation being passed at the General Meeting, it is anticipated that trading in the Ordinary Shares on AIM will cease at close of business on 21 February 2012 with the AIM Cancellation taking effect at 0700am on 22 February2012.

3.2         The principal effects of the proposed Aim Cancellation would include (amongst others):-

3.2.1      there would be no public stock market in the UK on which Shareholders can trade their Ordinary Shares (although Shareholders should note that the Alternext Listing would continue);

3.2.2      the Company will no longer be required to comply with the AIM Rules (or to have a nominated adviser) - the Company will however continue to be subject to the Alternext Rules (which, amongst other things, requires the Company to provide financial updates to the market at prescribed intervals but which would not for instance require prior shareholder approval to any form of sales or disposals by the Company, however material);

3.2.3      the Company will no longer be required to comply with any of the additional specific corporate governance requirements for companies admitted to trading on AIM;

3.2.4      the Company's CREST facility will be cancelled and, although the Ordinary Shares will remain transferable, they will cease to be transferable through CREST. Instead, Shareholders who hold Ordinary Shares in CREST will receive share certificates.

3.3         Shareholders should note that, under current Code provisions, the Company will remain subject to the provisions of the City Code on Takeovers and Mergers for a period of at least 10 years from the effective date of the proposed AIM Cancellation (expected to be 22 February2012).  Accordingly, Shareholders will continue to receive the protections afforded by the Code in the event that an offer is made to Shareholders to acquire their Ordinary Shares.

4.           Transactions in the Ordinary Shares following AIM Cancellation

As a result of the proposed AIM Cancellation the Board recognises that it will make it more difficult for the Shareholders to buy and sell Ordinary Shares in the UK should they want to do so.  The Alternext Listing will not be effected by the AIM Cancellation and Shareholders are recommended to speak to their brokers about the procedures (and any associated costs) for trading (or enabling the ability to trade) on Alternext to assess whether such procedures may be available to Shareholders holding certificated shares going forward (or whether, for those currently holding through CREST, preparatory arrangements can be put in place prior to the cessation of dealings in CREST). The Board will, in any event, review on an on-going basis whether it can facilitate trading on a matched bargain basis in the UK and Shareholders interested in any such potential matched bargain arrangements should contact the Company Secretary (on 00 44 151 706 0626) in the first instance.

Shareholders are also advised toseek advice from a stockbroker, solicitor, accountant, or other appropriate independent professional adviser authorised under the Financial Services and Markets Act 2000, as amended, if you are in the United Kingdom or, if not, from another appropriately authorised independent professional adviser in relation to any proposed sale of their Ordinary Shares.

5.           GENERAL MEETING

The AIM Cancellation is conditional upon the passing of the Resolution at the General Meeting.  Accordingly, you will find set out in the Circular a notice convening the General Meeting to be held at 30 Crown Place, London EC2A 4ES at 11 a.m on 9 February 2012, at which Shareholders will be asked to consider and, if thought fit, approve the Resolution as set out in the Notice of General Meeting.

If Shareholders wish to buy or sell the Ordinary Shares on AIM they must do so prior to the proposed AIM Cancellation becoming effective.  As noted above, in the event that Shareholders approve the proposed AIM Cancellation, it is anticipated that the last day of dealings in the Ordinary Shares on AIM will be 21 February 2012 and that the effective date of AIM Cancellation will be 22 February 2012.

6.           ActionS to be taken by shareholders

You will find enclosed with the Circular a From of Proxy for use at the General Meeting. To be valid, a Form of Proxy must be completed and signed in accordance with the instructions thereon and returned to the Company's registrars, Capita Registrars, PXS, The Registry, 34 Beckenham Road, Beckenham, Kent BR3 4TU as soon as possible and in any event so as to be received by no later than 11 a.m. on 7 February 2012.  The completion and return of a Form of Proxy will not prevent Shareholders who are entitled to vote from attending and voting in person at the General Meeting if they so wish.  Crest members who wish to appoint a proxy or proxies through the CREST electronic proxy service may do so for the General Meeting (and any adjournment thereof) by using the procedures described in the CREST manual.  CREST personal members or other CREST sponsored members and those CREST members who have appointed a voting service provider should refer to their CREST sponsor or voting service provider who are able to take the appropriate action on their behalf.

7.           Recommendation

Your Board considers the passing of the Resolution to be in the best interests of the Company and its Shareholders as a whole.  Accordingly, your Board unanimously recommends that you vote in favour of the Resolution set out in the Notice of General Meeting.

Yours sincerely

David Chestnutt

Chief Executive Officer

For and on behalf of the Board

EXPECTED TIMETABLE OF PRINCIPAL EVENTS

Publication of this document, the Notice of the General Meeting and the Form of Proxy	24 January 2012
Latest time and date for receipt of Forms of Proxy for the General Meeting of Shareholders	11 a.m. on 7 February 2012
General Meeting of Shareholders	11 a.m. on 9 February 2012
Last day of dealings in Ordinary Shares on AIM and in CREST	21 February 2012
Expected date of cancellation of admission to trading on AIM	22 February 2012

Notes:

1.               References to times in the Circular are to London time unless otherwise stated. 2.         If any of the above times and/or dates change, the revised times and/or dates will be notified to Shareholders by an announcement through a regulatory information service recognised by the London Stock Exchange. 3.          The cancellation of admission to trading on AIM requires the approval of not less than 75 per cent of the votes cast by Shareholders at the General Meeting (and all events in the above timetable following the General Meeting assume that the Resolution is approved by Shareholders and that the General Meeting is not adjourned).

DEFINITIONS AND GLOSSARY OF KEY TERMS

"£"	pounds sterling, the lawful currency for the time being of the UK
"Admission"	the admission of the Ordinary Shares to trading on AIM
"AIM"	a market operated by the London Stock Exchange
"AIM Cancellation"	the cancellation of admission of the Ordinary Shares to trading on AIM
"AIM Rules"	the current rules published by the London Stock Exchange which set out rules and responsibilities in relation to companies listed on AIM Companies
"Alternext"	the Alternext stock market regulated by Euronext Paris SA
"Alternext Listing"	the listing of (some or all of the) Ordinary Shares on Alternext
"Alternext Loan Note Listing"	the listing of the Loan Notes on Alternext
"Alternext Rules"	the current rules published by Euronext Paris SA which set out rules and responsibilities in relation to companies listed on Alternext
"Board" or "Directors"	the members of the board of directors of the Company whose names are set out in page 3 of the Circular
"Capita" or "Registrars"	a trading division of Capita Registrars Limited of The Registry, 34 Beckenham Road, Beckenham, Kent BR3 4TU
"Circular"	this circular to Shareholders dated 24 January 2012
"Code"	the City Code on Takeovers and Mergers
"CREST"	the computerised system for the paperless settlement of sales and purchase of securities and the holding of uncertificated securities operated by Euroclear UK & Ireland Limited under the CREST Regulations
"CREST Regulations"	the Uncertificated Securities Regulations 2001 (SI 2001 No.3755), as amended (including pursuant to the Companies Act 2006 (Consequential Amendments) (Uncertificated Securities) Order 2009)
"Form of Proxy"	the form of proxy for use in connection with the General Meeting accompanying the Circular
"General Meeting"	the general meeting of the Company to be held at 30 Crown Place, London EC2A 4ES notice of which is set out on page 9 of the Circular
"Group"	Proventec plc, its subsidiaries and subsidiary undertakings
"Loan Notes"	the 7% fixed rate unsecured loan notes 2015 issued by the Company
"London Stock Exchange"	London Stock Exchange plc
"Ordinary Shares"	the fully paid ordinary shares of £0.10 each of the Company
"Proventec" or "Company"	Proventec plc incorporated in England and Wales with registered number 04134409
"Resolution"	the resolution set out in the notice of General Meeting contained in the Circular
"Shareholders"	holders of Ordinary Shares (and "Shareholder" shall be construed accordingly)
"UK"	United Kingdom

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