Synairgen PLC (AIM:SNG, OTC:SYGGF) is set to become the latest in a growing wave of smaller companies leaving London’s AIM market after struggling to lock down fresh investment.
The biotech firm, which has been developing an inhaled treatment for respiratory infections, confirmed plans to cancel its listing and go private after failing to meet fundraising targets.
The company had hoped to raise £2.9 million to keep its shares trading publicly, alongside an £18 million investment from TFG Asset Management.
But after securing only £2.2 million in commitments, it fell short of the required threshold. With its majority shareholder, TFG, backing the move, Synairgen’s exit from AIM now looks inevitable.
Going private, the company argues, is the best way forward. Without the costs and regulatory burden of being a listed business, it can focus on its long-term strategy without the pressure of daily share price movements.
For existing investors, trading in Synairgen shares will still be possible through a secondary market platform run by Asset Match. This electronic service will allow shares to be bought and sold in periodic auctions for at least 12 months after the delisting.
Shareholders will vote on the proposals at a general meeting on March 28, with the AIM cancellation expected to take effect on April 9. Those still holding shares will receive paper certificates and can continue trading through the new facility.
Synairgen’s decision highlights the challenges facing many smaller companies on AIM, where securing investment and fair valuations has become increasingly difficult.
Last year 89 businesses, mainly small-caps, exited the public markets, many following the same route as Synairgen, citing lack of access to capital, high listing costs and rock bottom valuations.