The UK stock exchange Plus Markets is bowing out of the competition due to lack of funds, according to recent reports. In a statement the company said that its cash balance had dropped to a level where the board decided it was necessary to notify the FSA (Financial Services Authority) that Plus would be commencing “. . . a process of orderly closure.”
Plus originated as a challenger or an alternative to AIM., the Alternative Investment Market, focusing on smaller, ambitious companies to which it offered lower listing costs and less rigid reporting requirements. It has encountered difficulties that basically culminated in 2011, when its losses in the first six months of the year were £1.4 million and its turnover in the same period only £1.46 million.
In February this year, Plus went on the market as ‘for sale by owner’ in hopes of raising enough money to build its reserves and become profitable after showing a loss for each of the past six years. Though it did receive several proposals, the company said that none were acceptable and/or deliverable. Now the plan is to wind down the company’s activities over a six month period so there will be minimal disruption of the market.
As opposed to more than 1,250 companies listed with AIM, Plus had only 156 on its roster as of April this year, though they included some famous names like Arsenal and Ranger football clubs and Shepherd Neame brewers. Plus said it intends to operate as normal during the closing down and try to assist its clients in finding another platform for trading their shares.
This week the board announced it would try to sell remaining assets and return as much as possible to the company’s shareholders, or turn the company into an investing firm with rules similar to AIM’s.