SECURITIES AND EXCHANGE COMMISSION
Issuer Delisting; Order Granting the Application of Premier Farnell plc to Withdraw its Ordinary Shares, (5 pence each) ("Ordinary Shares"), its $1.35 and 89.2p Cumulative Convertible Redeemable Preference Shares (£1 each) ("Preference Shares"), and the American Depository Shares representing the Ordinary Shares and Preference Shares, from Listing and Registration on the New York Stock Exchange, Inc. File No. 1-14258
February 15, 2005
On December 10, 2004, Premier Farnell plc, a company incorporated under the laws of England and Wales ("Issuer"), filed an application with the Securities and Exchange Commission ("Commission"), pursuant to Section 12(d) of the Securities Exchange Act of 1934 ("Act")1 and Rule 12d2-2(d) thereunder,2 to withdraw its ordinary shares (5 pence each) ("ordinary shares"), its $1.35 and 89.2p cumulative convertible redeemable preference shares (£1 each) ("preference shares"), and the American Depository Shares ("ADS") representing both the ordinary shares and preference shares (collectively "Securities"), from listing and registration on the New York Stock Exchange, Inc. ("NYSE" or "Exchange"). Notice of such application requesting comments was published in the Federal Register on January 13, 2005.3 The Commission received one comment letter on the application 4 and the Issuer's response to the comment letter.5 As discussed below, the Commission is granting the application.
The Board of Directors ("Board") of the Issuer unanimously approved a resolution on December 7, 2004 to withdraw the Issuer's Securities from listing on the NYSE. The Board stated that the following reasons factored into its decision to withdraw the Securities from the Exchange. First, the Issuer's US shareholder base has reduced considerably since the listing of its Securities on the NYSE and registration of such Securities with the Commission in 1996. Trading of the ADS on the NYSE has declined considerably since the listing. According to Thomson Financial Datastream, the average daily trading volume of the ordinary shares ADS from April 12, 1996, the first day of their trading, to February 2, 1997, the Issuer's financial year end, was 70,900. The average daily trading volume during the financial year ended February 1, 2004 was 13,200, and between that financial year end and November 29, 2004 was approximately 15,400. The average daily trading volume of the preference shares ADS from April 12, 1996 to February 2, 1997 was 84,900. The average daily trading volume during the financial year ended February 1, 2004 was 1,600, and between the financial year end and November 29, 2004 was approximately 800. These declines have caused the Issuer to re-evaluate the merits of maintaining its NYSE listing and Commission registration. Next, as a result of this re-evaluation, the Issuer has decided to apply to terminate its NYSE listing now and may, in the future, seek to de-register from the Commission if eligible to do so. Since 1996, the burden and expense of complying with US reporting and registration obligations has increased and would substantially increase further by virtue of the new Commission rules under the
Sarbanes-Oxley Act relating to internal financial control documentation. Finally, the costs of maintaining the Issuer's NYSE listing and Commission registration, including the costs of management time required, for the year ending January 29, 2006 would be approximately £1.3million. These costs do not take into account the opportunity cost to the Issuer or management effort that would be required to be dedicated to meeting the internal control documentation requirements. This would include delays to other business initiatives. The Issuer stated that the ordinary shares and preference shares will continue to be listed on the London Stock Exchange, their principal trading market.
The Issuer stated in its application that it has complied with the NYSE's rules governing an issuer's voluntary withdrawal of a security from listing and registration by complying with all applicable laws in effect in England and Wales, the jurisdiction in which the Issuer is incorporated. The Issuer's application relates solely to the Securities' withdrawal from listing on the NYSE and from registration under Section 12(b) of the Act,6 and shall not affect their obligation to be registered under Section 12(g) of the Act.7
The Commission, having considered the facts stated in the application and having due regard for the public interest and protection of investors, orders that the application be, and it hereby is, granted, effective at the close of business on February 16, 2005.8
For the Commission, by the Division of Market Regulation, pursuant to delegated authority. 9
Jonathan G. Katz
1 15 U.S.C. 78l(d).
2 17 CFR 240.12d2-2(d).
3 See Securities Exchange Act Release No. 51001 (January 7, 2005), 70 FR 2431.
4 See Letter from Daniel R. Tisch, Managing Member, TowerView LLC, dated January 24, 2005.
5 See Letter from S J Webb, General Counsel and Company Secretary, Premier Farnell plc, dated January 28, 2005.
6 15 U.S.C. 78l(b).
7 15 U.S.C. 78l(g).
8 As noted earlier, the Commission received one comment letter regarding the Issuer's application and the Issuer's response to such comment letter. See notes 4 and 5, supra.
The Commission has considered the comment letter and the Issuer's response. The Commission is satisfied that the Issuer's application is consistent with the requirements of Rule 12d2-2 under the Act. The Issuer has set forth a description of the securities involved, together with a statement of all material facts relating to the reasons for delisting and has acted in accordance with the rules of the Exchange.
9 17 CFR 200.30-3(a)(1).