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Lighthouse left marooned as shareholders reject de-listing

Company claimed investors have no appetite for listed IFA firms and said benefits of being listed do not apply.

By Michael Trudeau and Ashley Wassall | Published Jul 31, 2012 | comments

Lighthouse Group shareholders have voted against de-listing the company from the Alternative Investment Market of the London Stock Exchange, despite pleas from management in recent weeks that investor appetite for IFA firms is low.

At the company’s annual general meeting, just over 53 per cent of votes cast were against the de-listing, and just under 47 per cent in favour.

Earlier this month the company announced it was to seek shareholder approval to de-list, arguing that investor interest in advisory companies was weak in the run-up to the Retail Distribution Review.

The firm said that “none of the benefits traditionally associated with being admitted to trading on Aim have applied to the company for some considerable time”, which many took to mean that it would prove difficult for the firm to raise money on the market in the coming years.

In the wake of the announcement, the firm faced a barrage of criticism, with many shareholders claiming that the shock move would hit investors hard, especially given a tacit refusal by the company management to set a price for the de-listing.

Shareholder Paul Mumford, senior investment manager at Cavendish Asset Management, has a 5 per cent holding in Lighthouse Group shares in his £17m Aim fund and said the manner of the de-listing has created uncertainty over the future of the group.

He said: “Lighthouse management thinks there might not be much of a future for the company once the RDR reforms come into effect. The de-listing is shoddy to say the least, and will disproportionately hurt the majority of shareholders.”

Others said the move was prompted by a desire to avoid onerous transparency requirements and could represent a backdoor buyout by the management. Both assertions were refuted by the Lighthouse board.

It emerged last week that several companies including Capita had approached the group with offers of share-trading facilities should the company go ahead with the de-listing.

In the aftermath of the shareholder vote, David Hickey, chairman of Lighthouse, said: “The business remains in good shape, being both cash positive and debt free.

“Looking forward the group will continue to comply with the Aim rules, and the board will continue to respect shareholders’ preferences.”

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