1 April 2025

Samarkand Group plc

("Samarkand" or the "Company")

Proposed Withdrawal of the Company's Ordinary Shares from trading on the AQSE Growth Market, Re- Registration as a Private Company and Notice of General Meeting

Samarkand Group plc, (AQSE:SMK), the consumer brand owner and cross border eCommerce distribution services group, is today announcing that today a circular will be sent to Shareholders detailing resolutions to be considered at a General Meeting scheduled for 11.00 a.m. on 2 May 2025 regarding the withdrawal of the Company's Ordinary Shares from trading on the AQSE Growth Market, for the Company to be Re-registered as a private limited company and to adopt New Articles.

If the Withdrawal resolutions are passed at the General Meeting, it is anticipated that the Withdrawal will become effective at 7.00 a.m. on 7 May 2025. The Directors have applied for trading under the Matched Bargain Facility to be provided by JP Jenkins, and which will commence at 8.00 a.m. on 7 May 2025.

The Directors of the Company are responsible for the contents of this announcement.

The information contained within this announcement is deemed by the Company to constitute inside information stipulated under the Market Abuse Regulation (EU) No. 596/2014, as retained as part of the law of England and Wales.

For more information, please contact:

Background to and reasons for the Withdrawal and Re‐registration

Founded in 2016, Samarkand was established to enable third-party consumer brands to access Chinese consumers through cross-border e-Commerce. The Company has since shifted its strategy away from the Chinese market due to growing geopolitical uncertainty, worsening economic conditions and unfavourable market trends. The strategic focus, as communicated in the Company's Interim Results dated 4 November 2024, is now principally as a consumer brand owner operating a scale up platform for differentiated, specialist health and healing brands and the primary objective of the Company is to reach consistent profitability.

The Board has evaluated the benefits and drawbacks to the Company and its Shareholders of retaining the Company's listing on the AQSE Growth Market and we believe that the Withdrawal is in the best interests of the Company and its Shareholders as a whole.

In reaching this conclusion, the Board has considered the following key factors:

·     Challenging conditions for small and micro-cap companies on the public markets: UK small and micro‐cap public markets have changed significantly since the Company's IPO and the Board believes that the Company's current size makes its unattractive as a listed business. In addition, the market is, in the Board's opinion, undervaluing micro-cap market companies and this is unlikely to change in the medium term.

·     Share price not representative of the Company's true value and associated difficulties: The Directors believe that the value of the Company, in terms of its assets, capabilities and potential, is not currently reflected in the share price and this limits the options available in terms of structuring further acquisitions, fundraisings and attracting new partners, all of which limit the possible further growth and development of the Company. It is the Board's opinion that this is unlikely to change in the medium term.

·     Medium term debt and deferred consideration obligations: the Board believes that both the renegotiation of the Company's debt obligations, which fall due in September 2025, and the payment of deferred consideration on recent acquisitions in the coming financial year, will involve further restructuring and re-enforce the need to further reduce and manage the Company's cost base.

·     Access to Capital: There has been limited liquidity and significant volatility on small traded volumes in the Ordinary Shares for some time and, as a result, the Directors believe that a continued listing on AQSE no longer sufficiently provides the Company with the advantage of access to capital in the medium term at an attractive price, nor provides liquidity to investors. As a result, the Directors have concluded that the most likely source of future funds would be through private capital and further debt funding.

·     Limited free float and lack of liquidity of the Ordinary Shares: As a result of the limited liquidity in the Ordinary Shares highlighted above, the listing of the Ordinary Shares on AQSE does not necessarily offer investors the opportunity to trade in meaningful volumes, or with frequency within an active market. With low trading volumes, the Company's share price can move up or down significantly following trades of small volumes of Ordinary Shares. In the opinion of the Board, this has negatively impacted its industry reputation.

·     Disproportionate cost-benefit analysis of maintaining the Company's listing: Management time and the legal and regulatory burden, together with the associated costs of maintaining the Company's listing on AQSE are, in the Board's opinion, disproportionate to the benefits when taking into account the size of the Company. The Board believe that the time and cost savings associated with the Withdrawal and Re-registration can be better spent supporting growth in the Group's business, especially in supporting the Group's owned brands.

Following careful consideration, and for the reasons set out above, the Directors believe that it is in the best interests of the Company and its Shareholders to seek the proposed Withdrawal. In addition, with the Re-registration, it is proposed that the New Articles be adopted to reflect the change in the Company's status as a private limited company. The principal effects of the Re‐registration and the adoption of the New Articles on the rights and obligations of Shareholders and the Company are summarised later in this announcement.

Process for, and principal effects of, the Withdrawal

The Withdrawal is conditional, pursuant to Rule 5.3 of the AQSE Rules, upon the approval of both Resolutions 1 and 2. Resolution 1, being a special resolution, requires the approval of not less than 75 per cent. of the votes cast by shareholders at the General Meeting. Resolution 2, which is an additional Withdrawal Resolution, is required pursuant to Rule 5.3 of the AQSE Rules as there is a Controlling Shareholder. Resolution 2 requires the approval of not less than 50 per cent. of the votes cast by Independent Shareholders (whether present in person or by proxy) at the General Meeting.

Resolution 3 (which is conditional on Resolution 1 and 2 passing) relates to the Re-registration and the adoption of New Articles and must be approved by not less than 75 per cent. of the votes cast by Shareholders (whether present in person or by proxy) at the General Meeting.

Under the AQSE Rules, the Company is required to give at least 20 clear Business Days' notice of Withdrawal.  If the Withdrawal Resolutions are passed at the General Meeting, it is proposed that the last day of trading in Ordinary Shares on AQSE Growth Market will be 6 May 2025 and that the Withdrawal will take effect at 7.00 a.m. on 7 May 2025. Trading under the Matched Bargain Facility to be provided by JP Jenkins will commence at 8.00 a.m. on 7 May 2025.

The principal effects of the Withdrawal will include the following:

·     there will be no formal market mechanism enabling the Shareholders to trade Ordinary Shares save for the Matched Bargain Facility;

·     it is possible that, following the publication of the Circular, the liquidity and marketability of the Ordinary Shares is further reduced and their value adversely affected;

·     the Ordinary Shares may be more difficult to sell compared to shares of companies traded on AQSE (or any other recognised market or trading exchange);

·     in the absence of a formal market and quote, it may be difficult for Shareholders to determine the market value of their investment in the Company at any given time;

·     the regulatory and financial reporting regime applicable to companies whose shares are admitted to trading on AQSE will no longer apply;

·     Shareholders will no longer be afforded the protections given by the AQSE Rules, such as the requirement to be notified of price sensitive information or certain events and the requirement that the Company seek shareholder approval for certain corporate actions, where applicable, including substantial transactions, reverse takeovers, related party transactions and fundamental changes in the Company's business, including certain acquisitions and disposals;

·     the levels of disclosure and corporate governance within the Company will not be as stringent as for a company listed on AQSE;

·     the Company will no longer be subject to the UK MAR regulating inside information and other matters;

·     the Company will no longer be required to publicly disclose any change in major shareholdings in the Company under the Disclosure Guidance and Transparency Rules although the Takeover Code will continue to apply to the Company following the Withdrawal until 7 May 2027;

·     there will cease to be an AQSE Corporate Advisor to the Company;

·     whilst the Company's CREST facility will remain in place immediately post the Withdrawal and while the Company remains on the JP Jenkins platform the Company's CREST facility may be cancelled in the future and, although the Ordinary Shares will remain transferable, they may cease to be transferable through CREST (in which case, Shareholders who hold Ordinary Shares in CREST will receive share certificates);

·     stamp duty will be due on transfers of shares and agreements to transfer shares unless a relevant exemption or relief applies to a particular transfer; 

·     the Withdrawal and Re‐registration may have personal taxation consequences for Shareholders. Shareholders who are in any doubt about their tax position should consult their own professional independent tax adviser.

The above considerations are not exhaustive, and Shareholders should seek their own independent advice when assessing the likely impact of the Withdrawal on them.

For the avoidance of doubt, the Company will remain registered with the Registrar of Companies in England & Wales in accordance with and, subject to the Companies Act, notwithstanding the Withdrawal and Re-registration.

 The Company will:

·     continue to communicate information about the Company (including annual accounts) to its Shareholders, as required by the Companies Act; and

·     continue, for at least 12 months following the Withdrawal, to maintain its website, www.samarkand.global and to post updates on the website from time to time, although Shareholders should be aware that there will be no obligation on the Company to include all of the information required under the Disclosure Guidance and Transparency Rules or the AQSE Disclosure and Transparency Obligations as required by the AQSE Rules.

There will be no change to the composition of the Executive Board or senior management immediately following the Withdrawal and Re-registration.

The Company will look at restructuring its wider Board as part of ongoing cost-cutting and with a view to adopting a Board appropriate for a private limited company.

The Resolutions to be proposed at the General Meeting include the adoption of the New Articles with effect from the Re‐registration. A summary of the principal differences between the Current Articles and the proposed New Articles are included in this announcement.

Transactions in the Ordinary Shares prior to and post the proposed Withdrawal

Prior to Withdrawal

Shareholders should note that they are able to continue trading in the Ordinary Shares on AQSE Growth Market prior to Withdrawal.

Following Withdrawal

The Company has made arrangements for a Matched Bargain Facility provided by JP Jenkins from the date of Withdrawal.

Under the Matched Bargain Facility, Shareholders or persons wishing to acquire or dispose of Ordinary Shares will be able to leave an indication with JP Jenkins, through their stockbroker (JP Jenkins is unable to deal directly with members of the public), of the number of Ordinary Shares that they are prepared to buy or sell at an agreed price. In the event that JP Jenkins is able to match that order with an opposite sell or buy instruction, it would contact both parties and then effect the bargain (trade). Should the Withdrawal become effective, and the Company puts in place the Matched Bargain Facility, details will be made available to Shareholders on the Company's website at www.samarkand.global.

Whilst it is the Directors intention that the Matched Bargain Facility will operate for a minimum of twelve months after Withdrawal it could be withdrawn after that date and therefore inhibit the ability to trade the Ordinary Shares. In such circumstances further details will be communicated to the Shareholders at the relevant time.

There can be no guarantee as to the level of the liquidity or marketability of the Ordinary Shares under the Matched Bargain Facility, or the level of difficultly for Shareholders seeking to realise their investment under the Matched Bargain Facility.

If you are in any doubt as to the action you should take, you are recommended to seek advice from your solicitor, accountant or other independent financial adviser authorised under the Financial Services and Markets Act 2000 (as amended) if you are in the United Kingdom or, if not, by another appropriately authorised independent financial adviser.

If Shareholders wish to buy or sell Ordinary Shares on AQSE Growth Market they must do so prior to the Withdrawal becoming effective. As noted above, in the event that Shareholders approve the Withdrawal, the last day of dealings in the Ordinary Shares on the AQSE Growth Market will be 6 May 2025 and that the effective date of the Withdrawal will be 7.00am on 7 May 2025.

Re‐registration

As set out above, following the Withdrawal, the Directors believe that the requirements and associated costs of the Company maintaining its public company status will be difficult to justify and that the Company will benefit from the more flexible requirements and lower costs associated with private limited company status. It is therefore proposed to re‐register the Company as a private limited company. In connection with the Re‐registration, it is proposed that the New Articles be adopted to reflect the change in the Company's status to a private limited company. The principal effects of the Re‐registration and the adoption of the New Articles on the rights and obligations of Shareholders and the Company are summarised later in this announcement.

Under the Companies Act, the Re-registration and the adoption of the New Articles must be approved by Shareholders holding not less than 75 per cent. of votes cast by Shareholders at the General Meeting.

An application will be made to the Registrar of Companies for the Company to be re‐registered as a private limited company. Re‐registration will take effect when the Registrar of Companies issues a certificate of incorporation on Re‐registration. The Registrar of Companies will only issue the certificate of incorporation on Re‐registration when it is satisfied that no valid application can be made to cancel the resolution to re‐ register as a private limited company or that any such application to cancel the resolution to re‐register as a private limited company has been determined and confirmed by the Court.

Withdrawal from the AQSE Growth Market

Under the AQSE Rules, it is a requirement that the Withdrawal must be approved by not less than 75 per cent. of votes cast by Shareholders at the General Meeting and by a majority of the votes attached to Ordinary Shares held by Independent Shareholders. Therefore, for transparency reasons, the Company proposes the Withdrawal Resolutions as Resolution 1 and Resolution 2.   All holders of Ordinary Shares are entitled to vote on Resolution 1 but only Independent Shareholders are eligible to vote on Resolution 2. The Company's Registrars will be instructed to disregard any votes cast by Shareholders who are not Independent Shareholders in connection with Resolution 2.

Furthermore, Rule 5.3 of the AQSE Rules requires any company that wishes to withdraw its securities from trading on AQSE to notify shareholders of its preferred withdrawal date at least 20 Business Days prior to such date. In accordance with AQSE Rule 5.3, the Directors have notified AQSE of the Company's intention, subject to the Withdrawal Resolutions being passed at the General Meeting, to withdraw trading in the Company's Ordinary Shares from the AQSE Access Growth Market on 7 May 2025. Accordingly, if the Withdrawal Resolutions are passed, the Withdrawal will become effective at 7.00am on 7 May 2025.  If the Withdrawal becomes effective, the Company will cease to have an AQSE Corporate Advisor and will no longer be required to comply with the AQSE Rules.

General Meeting

The General Meeting will be held at the offices of the Company, Unit 13 Tonbridge Trade Park, Ingot way, Tonbridge, Kent TN9 1GN.

Resolutions 1 and 2 to be proposed at the General Meeting are a special resolution and an ordinary resolution respectively to approve the Withdrawal.  Only Independent Shareholders are eligible to vote on Resolution 2. The Company's Registrars will be instructed to disregard any votes cast by Shareholders who are not Independent Shareholders in connection with Resolution 2.

Resolution 3 to be proposed at the General Meeting is a special resolution to re‐register the Company as a private company and to approve the adoption by the Company of the New Articles. Resolutions 1 and 2 are not conditional on Resolution 3, but Resolution 3 is conditional on both Resolutions 1 and 2.

Action to be taken in relation to the General Meeting

Shareholders are encouraged to appoint the chair of the General Meeting as their proxy with directions as to how to cast their vote on the Resolutions proposed. For further details on how to submit a proxy vote, please see the notes to the Notice of General Meeting at the end of the Circular.

The appointment of a proxy will not preclude Shareholders from attending and voting at the General Meeting in person should they so wish.

Irrevocable undertakings

In respect of Resolution 1 the Company has received an irrevocable undertaking from the Directors holding in aggregate 16,234,574 Ordinary Shares. In addition, the Company has received irrevocable undertakings from other shareholders holding in aggregate 28,710,238 of Ordinary Shares. In total the Company has received irrevocable undertakings to vote in favour of Resolution 1 in respect of 44,944,812 Ordinary Shares representing approximately 77.02 per cent. of the issued share capital.

In Respect of Resolution 2, where only Independent Shareholders are entitled to vote, the Company has received irrevocable undertakings from Independent Shareholders holding in aggregate 22,348,075 of Ordinary Shares representing approximately 64.24 per cent. of the issued share capital eligible to vote on this Resolution.

Recommendation

The Directors consider that the Withdrawal and the Re‐registration and adoption of the New Articles are in the best interests of the Company and its Shareholders as a whole and, therefore, unanimously recommend that you vote in favour of the Resolutions at the General Meeting.

Yours faithfully,

Tanith Dodge

Chairperson

Principal Effect of Re-Registration and Adoption of New Articles

Model Articles

Except in so far as they are modified or excluded by the New Articles, the model Articles for private companies limited by shares contained in Schedule 1 of the Companies (Model Articles) Regulations 2008 (SI 2008/3229) as amended prior to the date of adoption of the New Articles, shall apply to the Company save that in the event of a conflict between the Model Articles and a provision of New Articles, the New Articles shall prevail.

Accounts

A public company is required to file its accounts within six months following the end of its financial year and then to circulate copies of the accounts to Shareholders. Following the Re‐registration and the adoption of the New Articles, the period for the preparation of accounts is extended to nine months following the end of the financial year. The Company will still be required to circulate accounts to Shareholders (although the period for doing so is extended for private companies).

Per the ongoing requirements of JP Jenkins, the accounts of the Company will continue to be audited for so long as the matched bargain facility is in operation.

General meetings and resolutions

A public company is required to hold an annual general meeting of Shareholders each year, whereas a private company is not. Therefore, following the Re‐registration and the adoption of the New Articles, the Company will not be required to hold annual general meetings.

In addition, after the Re‐registration, resolutions of the Shareholders of the Company may be obtained via written resolutions, rather than via physical meetings. This is done by obtaining the approval in writing to that resolution of the holders of a majority of voting shares then in issue (in the case of ordinary resolutions) and the holders of at least 75 per cent. of the voting shares then in issue (in the case of special resolutions).

Directors

The Current Articles contain provisions requiring:

(a) the directors of the Company to retire by rotation every three years; and

(b) that one third of directors of the Company retire at each annual general meeting of the Company.

These provisions are not included in the New Articles. In addition, the New Articles will not require any director appointed by the Board to be re‐appointed by the Shareholders at the next annual general meeting following his appointment, as is currently required.

Issue of shares for non‐cash consideration

As a public company, there are restrictions on the ability of the Company to issue new shares. For example, as a public company, the Company is required to obtain a valuation report in the case of shares issued for non‐cash consideration. These restrictions will not apply following the Re‐registration and adoption of the New Articles.

Financial assistance, reductions of capital and purchase of own shares out of capital

As a public limited company, the Company is currently prohibited from performing actions which constitute financial assistance for the acquisition of its own shares. This limits the ability of the Company to engage in certain transactions. However, following the Re‐registration, these restrictions will no longer apply.

In addition, the Company must currently obtain the sanction of the Court for any reduction of capital, which can be a lengthy and expensive process. However, following the Re‐registration, the Company will be able to take advantage of more flexible provisions applicable to private companies, which do not require the approval of the Court.

Company Secretary

There is no requirement for a company secretary to be appointed, although the Company may appoint one should it wish.

Removal of unnecessary provisions and simplification

The New Articles will not contain certain of the detailed provisions of the Current Articles which are common for listed companies, and which will not be necessary for the Company following the Withdrawal.

The Takeover Code

The Takeover Code (the "Code") applies to any company which has its registered office in the UK, the Channel Islands or the Isle of Man if any of its equity share capital or other transferable securities carrying voting rights are admitted to trading on a UK regulated market, a UK multilateral trading facility ("MTF"), or a stock exchange in the Channel Islands or the Isle of Man. The Code therefore applies to the Company as its securities are admitted to trading on The Aquis Stock Exchange Growth Market, which is a UK MTF.

The Code also applies to any company which has its registered office in the UK, the Channel Islands or the Isle of Man if any of its securities were admitted to trading on a UK regulated market, a UK MTF, or a stock exchange in the Channel Islands or the Isle of Man at any time during the preceding two years.

Assuming the Withdrawal is approved by Shareholders at the General Meeting and becomes effective, the Code will continue to apply to the Company for a period of two years after the Withdrawal, following which the Code will cease to apply to the Company.

While the Code continues to apply to the Company, a mandatory cash offer will be required to be made if either:

(a) a person acquires an interest in shares which, when taken together with the shares in which persons acting in concert with it are interested, increases the percentage of shares carrying voting rights in which it is interested to 30% or more; or

(b) a person, together with persons acting in concert with it, is interested in shares which in the aggregate carry not less than 30% of the voting rights of a company but does not hold shares carrying more than 50% of such voting rights and such person, or any person acting in concert with it, acquires an interest in any other shares which increases the percentage of shares carrying voting rights in which it is interested.

Brief details of the Takeover Panel, and of the protections afforded by the Code, are set out below.

Before voting on the Withdrawal, you may want to take independent professional advice from an appropriate independent financial adviser.

The Takeover Code is issued and administered by the Panel. The Company is a company to which the Takeover Code applies and its Shareholders are accordingly entitled to the protections afforded by the Takeover Code.

The Takeover Code and the Panel operate principally to ensure that shareholders are treated fairly and are not denied an opportunity to decide on the merits of a takeover and that shareholders of the same class are afforded equivalent treatment by an offeror. The Takeover Code also provides an orderly framework within which takeovers are conducted. In addition, it is designed to promote, in conjunction with other regulatory regimes, the integrity of the financial markets.

The General Principles and Rules of the Takeover Code

The Takeover Code is based upon a number of general principles (the "General Principles") which are essentially statements of standards of commercial behaviour. For your information, these General Principles are set out in Part 1 of Appendix A of this Part III. The General Principles apply to all transactions with which the Takeover Code is concerned. They are expressed in broad general terms and the Takeover Code does not define the precise extent of, or the limitations on, their application. They are applied by the Panel in accordance with their spirit to achieve their underlying purpose.

In addition to the General Principles, the Takeover Code contains a series of rules (the "Rules"), of which some are effectively expansions of the General Principles and examples of their application and others are provisions governing specific aspects of takeover procedure. Although most of the Rules are expressed in more detailed language than the General Principles, they are not framed in technical language and, like the General Principles, are to be interpreted to achieve their underlying purpose. Therefore, their spirit must be observed as well as their letter. The Panel may derogate or grant a waiver to a person from the application of a Rule in certain circumstances.

Giving up the protection of the Takeover Code

A summary of key points regarding the application of the Takeover Code to takeovers generally is set out in Part 2 of Appendix A of this Part III. You are encouraged to read this information carefully as it outlines certain important protections which will cease to apply 2 years following Withdrawal. 

Expected Timetable of Principle Events

Notes:

All of the times referred to in the Document refer to London time, unless otherwise stated.

Each of the times and dates in the above timetable is subject to change. If any of the above times and/or dates change, the revised times and dates will be notified to Shareholders by an announcement through the Regulatory News Service.

Concert Party as agreed by the Takeover Panel

A Concert Party was agreed by the Takeover Panel. The following table shows the members of the Concert Party and their respective holdings:

Pursuant to AQSE Rule 5.3, if there is a Controlling Shareholder then there must be held a further Withdrawal Resolution upon which only Independent Shareholders are eligible to vote. The members of the above Concert Party are considered to be a Controlling Shareholder for the purposes of AQSE Rule 5.3 and are therefore not considered to be Independent Shareholders and will not be entitled to vote on Resolution 2. 

DEFINITIONS

The following definitions apply throughout this announcement, unless the context requires otherwise: