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Strathmore "don't sell" notice falls on deaf ears

By Phil Boeyen, ShareChat Business News Editor

Monday 31st July 2000

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Strathmore investors don't appear to be heeding the company's recent "don't sell" advice, with trading in the stock reaching greater than normal volumes in the past week.

SMR last week recommended shareholders not sell until it had provided the details of a 15% buy back, where it will offer shares in Sydney-based communications software company, Commsoft, as consideration.

The notice was issued after the market closed on Monday July 24, and the next day more than 1.8 million Strathmore shares were traded. The momentum slowed during the rest of the week but was still reasonable on Friday with more than 450,000 shares changing hands.

The pro rata offer could well be the precursor to announcing an ASX listing for Commsoft, but Strathmore isn't commenting until details of the offer are made to shareholders.

In May Commsoft was reportedly planning to raise A$30 million, either via a listing on the Australian Stock Exchange or through venture capital injections, to embark on an aggressive acquisition strategy.

Stockbroker Warburg Dillon Read was going to manage the capital raising, with A$24 million earmarked for acquisitions and the rest for working capital.

Commsoft's MD Rodney Martin was quoted at the time as saying the company may also seek a listing on the Nasdaq.

Strathmore, which has invested $NZ5.5 million and owns 38%, of Commsoft, says its shareholders will receive the formal offer form and buy back information memorandum with the share ratio details in August. They will then have ten days in which to take up the offer.

SMR's directors, and the cornerstone and institutional investors which include Advantage Group, Cullen Investments and New Zealand Funds Management, have all indicated their intention to accept the as yet undisclosed offer.

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