Long-suffering shareholders of troubled buy now pay later provider Laybuy are sceptical about their prospects after the board floated plans to delist the company from the ASX.
Laybuy scrip was placed in a trading halt on Monday after directors said they would release details of a delisting application by the close of business on Wednesday.
The announcement took many shareholders by surprise because it follows a string of somewhat upbeat reports from the company regarding its financial performance towards the end of 2022.
Some investors said on social media that they were alarmed that the company had already lodged an application to be removed from the ASX list before putting a resolution to a meeting of shareholders.
Laybuy announced in November that it had improved its operating margins in the six months to the end of September 2022 after it implemented a special program to reduce customer fraud and defaults.
The unaudited first half loss of NZ$14.9 million was a marked improvement on the NZ$22.5 million loss reported in the previous corresponding period.
However, it did little to support the Laybuy share price, which has traded in a range of 4 cents to 6 cents for the past five months.
Laybuy’s board and management have been scrambling to retrieve investor confidence in the last year as the firm’s business model came under extreme pressure as funding costs and other expense items blew out in 2022.
The company, which is headquartered in New Zealand, is an active BNPL player in the UK, Australian and Kiwi markets.
At the end of June directors announced they had entered a process for the partial sale of the business, but a transaction never eventuated.
Many longstanding shareholders who are perched on big unrealised losses yesterday raised concerns on social media platforms about the proposed delisting.
Some investors who joined the company register in 2021 paid more than $1.50 for each of their shares.
“Since the company is financially improving and is not violating the listing requirements to what I am aware of, they are more likely delisting on the ASX voluntarily,” one shareholder told the Hotcopper discussion platform.
“I am however still not happy about it, since I am trying to figure out how this will have a benefit for existing shareholders like myself.”