Lack of cash forces small business exchange to shut

PLUS Markets, the British stock exchange for small companies, plans to close after failing to attract an acceptable takeover offer, it was announced yesterday.

The loss-making group, which put itself up for sale in February, has informed the financial regulator that it plans an “orderly closure” after suffering a drop in its cash reserves.

The company said in a statement: “The regulated activities of the group will be wound down over a period of up to six months in order to minimise market disruption.”

Hide Ad
Hide Ad

Plus Markets said it would help the companies whose shares are traded on its exchange, including football club Arsenal and brewer Shepherd Neame, to find “suitable alternative arrangements”.

Plus Markets, which also operates the Plus DX derivatives exchange, ended efforts to sell itself because talks with potential suitors did not result in a “deliverable offer”.

Plus Markets grew out of Ofex, an exchange for British small cap stocks that required less regulation than the London Stock Exchange or AIM.

The company made a loss of £5.8m ($9.34m) on revenue of £3m in 2010, its sixth consecutive loss-making year.

Hide Ad
Hide Ad

Only a handful of Yorkshire firms are listed on Plus, including the Hull-based audio technology firm Feonic. Feonic, the former Newlands Scientific, is probably best known for its Whispering Windows technology which turns shop windows into loudspeakers.

The pioneering product has been adopted by a string of high-profile retailers such as Marks & Spencer, John Lewis and the French bus stop manufacturer, JC Decaux.

Brenda Hopkins, the chairman of Feonic, said she wasn’t surprised by the decision, and didn’t regret the fact that Plus planned to close.

She added: “We have felt for a long time that Plus has not been working well for us. There has only been one market maker for quite some time, and the cost associated with being on such a market is expensive.

Hide Ad
Hide Ad

“We will consider our options now, but as a board we have discussed the options of going off the Plus market and building up our balance sheet and trading on another market at a future date.”

Ms Hopkins said Feonic was going to explore the possibility of trading in Hong Kong or Singapore, where the company has strong relationships.

Jonathan Smith, a director of Leeds-based NJD Capital, which is also on Plus, said: “It’s a great shame that another source of finance for small businesses is going to be cut off.”

Mr Smith said he was working with the company’s advisers to consider its options.

NJD Capital acquires minority investments in small private UK firms.

Hull-based software developer Fidelity Systems left Plus in December last year.

Related topics: