Hornby PLC (LSE:HRN) is set to leave the stock market, joining the growing exodus of small-cap companies from the market.
The model train and collectibles company plans to delist from AIM and become a private company, arguing that it will allow for faster decision-making and reduce costs. Shareholders will vote on the move at a general meeting on 1 April.
CEO Lyndon Davies said the decision was not taken lightly, acknowledging Hornby’s loyal investor base. But with limited trading activity in its shares and high regulatory costs, the board believes it is the right step.
Major shareholders Castelnau and Aurora, controlling nearly 70% of shares, back the plan.
Hornby has been undergoing major restructuring. It acquired stakes in Warlord Games and Corgi Model Club, sold LCD Enterprises, cut staff, and relocated logistics to the Midlands. The company believes being private will make further changes easier.
Trading has been mixed. Sales are on track to grow year-on-year, but weak trading in January and February and shipping delays have created short-term challenges. New product launches, however, have been well received, with orders up 22% on last year.
For shareholders, Hornby is offering options. They can keep their shares, swap them for shares in investment firm Castelnau, or sell them for cash through a matched bargain facility.
If the vote passes, delisting is set for 10 April, with re-registration as a private company expected by late April.