A FTSE SMALL CAP Company Secretary & General Counsel writes...
Our registrar has come to us with a “Dematerialisation Readiness Strategy”. They want us to sign an addendum to the registrar agreement and pay a fixed fee of £5,000 plus VAT for a data cleanse, tracing and a shareholder engagement/education mailing ahead of the move to digital registers. We only have around 75 certificated holders, so £5k feels steep for the numbers involved. There also seems to be quite a rush on it and they want to do the work straight away even though I’m not aware of any regulatory reason why it’s urgent. I can’t help feeling that someone within the registrar saw dollar signs but perhaps I’m being cynical…
I wanted to sanity check whether you’re doing something similar and whether you thought this work was necessary/reasonable? Thoughts please.
Original poster here: by way of update, I spoke to our registrar today and agreed there’s no need to do anything yet. We will include an extra letter with our AGM mailing in 2027 and then do a sweep up exercise later in 2027.
The way it was presented was very much “sign this now, this is necessary work we need to do now” which is not the case and I’ve fed that back.
we have been quoted a higher amount – i did not feel like we had any choice.
We use Computershare – so far we have not been asked for any additional fees and their education sessions on the current state of play have been very helpful and advise using existing comms to shareholders such as AGM notice and dividend letters. We are still in the phase of getting to grips with an action plan – as far as I know the next milestone would be end of 2027 when all certificates will be invalid.
Our Registrars included the subject in a recent review meeting. It was presented as an update rather than a live workstream, other than the suggestion we consider doing any Register tidy up exercises when convenient.
In our case I pushed to be prepared before demat is a reality and had a very helpful (and sensible) initial conversation with the registrar. Our register is in reasonable good shape, some tidy up to do, and we will undertake those activities as and when we can. We have more than 75 certificated holders but in essence the majority of our holders are institutional and already dematerialised. I was expecting they would come up with some sort of charge/fee up front (as in your case) but that wasn’t the case. My impression is business as usual, keeping up with the tidy up activities, and also keeping an eye on developments. Demat is happening but there’s regulation still to be passed. For example, I was keen to update the articles asap but was advised to wait for the model articles.