Biotech firm Reneuron becomes latest to quit AIM as it battles for survival
Biotech firm Reneuron Group has become the latest company to exit from the London Stock Exchange’s AIM as it continues to fight for its life after entering administration.
The Welsh company, which was first floated on London’s junior market in 2005, said it did not believe it would be able to raise enough funds to resume public trading given the “additional costs and regulatory obligations” associated with the AIM market.
The announcement follows months of difficulty for the stem cell technology business, which entered administration in March and has since revealed plans to make redundancies.
Since then, Reneuron has been looking for potential investors to provide enough capital to allow it to continue trading as an “appropriately staffed” company. However, it has had limited success and now believes it stands a better chance as a private business.
In a statement issued today, Reneuron said: “If the joint administrators can reach agreements with the key creditors, the board plans to take the company private and exit administration.
“Afterward, a small team led by Iain Ross and Randolph Corteling will continue operations.
“The company aims to use its remaining cash to develop and potentially commercialise certain research assets, intellectual property, and existing licenses.
“The goal is to boost shareholder value and eventually secure a successful exit for the business.”
Reneuron’s announcement comes after City PM revealed Octopus Group had quietly pumped £25m of its own cash into the AIM market in a bid to take advantage of “mispriced” smaller companies.
Simon Rogerson, chief and founder of the holding and investment firm that spawned Octopus Energy, said he was “high conviction” on the future of the London Stock Exchange’s junior market and put his “money where [his] mouth is” last November.
“This is mispriced. We’re really comfortable and confident in the outlook for [the market],” he told City A.M. “We’ve been running money in that market for the last 15 to 20, years, and we are very high conviction.”
The investment came off the group’s own balance sheet and was spread across 16 separate companies, he added, including Keywords Studios, Gamma Communications and GB Group. Keywords was snapped up by private equity firm EQT in a £2.2bn in July.