Biotech firm Reneuron Group has become the latest company to leave the London Stock Exchange’s AIM as it struggles to survive after entering administration.
The Welsh company, which debuted on London’s junior market in 2005, announced that it does not anticipate raising sufficient funds to resume public trading due to the “additional costs and regulatory obligations” associated with the AIM market.
This decision follows months of challenges for the stem cell technology company, which entered administration in March and has since announced plans for layoffs.
Since then, Reneuron has been searching for potential investors to secure enough capital to continue operating as a smaller, “appropriately staffed” company. However, with limited success, it now believes it stands a better chance of survival as a private entity.
In a statement released today, Reneuron said, “If the joint administrators can reach agreements with key creditors, the board intends to take the company private and exit administration.
“Afterward, a small team led by Iain Ross and Randolph Corteling will continue operations.
“The company plans to use its remaining funds to develop and potentially commercialize certain research assets, intellectual property, and existing licenses.
“The aim is to enhance shareholder value and eventually secure a successful exit for the business.”
Reneuron’s decision comes after City A.M. reported that Octopus Group quietly invested £25 million of its own funds into the AIM market to capitalize on “mispriced” smaller companies.
Simon Rogerson, founder of the holding and investment firm behind Octopus Energy, expressed strong confidence in the future of the London Stock Exchange’s junior market and backed his belief with significant investment last November.
“We’re really comfortable and confident in the outlook for [the market],” he told City A.M. “We’ve been investing in this market for the last 15 to 20 years, and we have a high conviction in its potential.”
The investment was drawn from the group’s balance sheet and spread across 16 companies, including Keywords Studios, Gamma Communications, and GB Group. Keywords was acquired by private equity firm EQT in a £2.2 billion deal in July.
