Aquis Exchange accepts £194m offer from Swiss group in blow to London

London’s challenger stock market Aquis has accepted a £194m takeover offer from Swiss-based bourse operator SIX Group, in a move which will likely inflame fears over the health of the UK’s equity markets.

In a statement to the market today, Aquis said the offer would value its shares at 727p per share, a 120 per cent premium to Friday’s closing price of 330p per share.

Directors at the St Paul’s based bourse, which is dual listed on its own Apex market and the London Stock Exchange’s AIM, said the deal would help provide the scale needed to compete against bigger firms in the European exchange market.

“Under SIX’s ownership, Aquis will be better placed to deliver on its strategy of developing innovative capital market solutions from a position of further scale,” Aquis said.

The Swiss firm said the acquisition was a “compelling strategic opportunity” which will complement its strategy to “scale the business beyond its home markets”.

Analysts at AJ Bell said the deal could mean that London’s AIM market could soon face a “serious challenger”.

“SIX Group is an established player and could have some interesting ideas about how to make Aquis a success,” Dan Coatsworth, investment analyst at AJ Bell told City PM.

Alasdair Haynes, chief executive of Aquis, said he was “immensely proud” of the business which he founded in 2012.

Although he said there was a “clear path of growth ahead,” he said “operational, commercial and market risks” could pose a threat to the firm in the short term.

“The offer de-risks this future value creation and provides Aquis shareholders with certain value at a material premium,” he added.

The comments point to the downturn that has gripped the UK’s equity markets over the past two years.

Aquis has hosted only two new floats this year while 92 firms exited AIM in the year to October, pushing the total number of companies to a 23-year low of 695.

Global investors have also been withdrawing from UK markets, with domestic equity funds suffering outflows for 41 consecutive months which has contributed to depressed valuations.

“SIX is paying a substantial premium to the undisturbed price, which reflects the inherent undervaluation of so many UK companies, particularly in the small and midcap space,” Charles Hall, head of research at Peel Hunt told City PM.

“It is essential that the Mansion House speech fires the starting gun on reversing this trend,” he added.

The takeover of one of London’s stock markets by a foreign buyer will also likely fuel concern over a sell-off of listed companies.

In the 12 months to the end of June, 37 AIM-listed companies were acquired by overseas rivals and private equity firms, more than double the number of businesses bought the previous year.