Company slams Citi for planning to withdraw from London Stock Exchange

Tuesday, December 31, 2024 7:43am

DG Innovate has announced plans to halt its listing on the London Stock Exchange, citing a lack of investor demand for early-stage companies.

DG Innovate is a research and development company specializing in sustainable transportation and energy storage.

The company said it has made “significant progress in its business operations” over the past year, but is still struggling to raise enough capital to invest in its commercialization strategy.

This lack of demand was partly due to the constraints of prospectus rules, but it was also a result of a lack of interest from domestic institutional investors in early-stage companies.

“There has been, and continues to be, a widespread lack of demand for exposure to companies at DGI’s current stage of development within the UK’s traditional institutional investor base,” the firm said.

DG Innovate said there are “no obvious short-term catalysts” that would change this backdrop.

“The costs, regulatory requirements and additional administrative burden associated with keeping the company listed are now completely disproportionate to…the benefits,” it added.

The company said delisting would reduce its cost base and facilitate capital raising, and said it was in talks with “potential investors” who could make “significant investments” if it were delisted.

The delisting will take effect from January 31st.

Although it is a small company, the delisting of DG Innovate marks the end of another bad year for the London Stock Exchange.

According to LSEG data, 88 companies have been delisted or moved their primary listing from London’s main market this year. This would be the largest net exodus of companies from the market since the 2009 financial crisis.

The new government is pushing ahead with reforms to revitalize London’s capital markets, including merging pension funds to allow for greater investment in domestic companies.