Wealth Manager - the site for professional investment managers

Register to get unlimited access to Citywire’s fund manager database. Registration is free and only takes a minute.

Merchant House withdraws from AIM as funding efforts fail

Merchant House withdraws from AIM as funding efforts fail

Financial services group Merchant House has announced it has failed to raise sufficient funds to restore trading in its shares on the AIM market.

Shares in Merchant House Group, which bought collapsed IFA group Clarkson Hill in 2010, have been suspended since April this year.

The group said in a statement to the market: 'The company regrets to announce that despite considerable efforts by the board, the company has been unable to raise sufficient funding in time to restore trading on AIM in the company's ordinary shares and therefore admission to AIM will be cancelled pursuant to the AIM rules.'

It added that it had entered into some investment agreements that were conditional on the share suspension being lifted, and that it would now seek to renegotiate those deals. 'There is no guarantee that these discussions will result in a satisfactory outcome but shareholders and creditors will be updated within the next few days,' it said.

'In the meantime the company will consider all the options open to it to preserve value to shareholders,' it added. Group chairman James Holmes said in October that if the company failed to secure further funding it would consider selling off parts of the business.

Merchant House requested the suspension of its shares in March this year and, after trading was briefly reinstated, in April, due to capital fears.

The group's acquisition of assets from Clarkson Hill, and recruitment of 188 advisers from the national IFA, has taken its toll on the company. In its results for 2011, it blamed a £5.6 million loss in part on delays in reauthorising those advisers with the Financial Services Authority. 

The collapse of Pritchard Stockbrokers in March also affected the group, which used Pritchards as the custodian for its structured product subsidiary Merchant Capital. It held £8.8 million on account with Pritchard at the end of June 2011, and said earlier this year it could not determine whether its clients would lose out as a result of the Financial Services Authority’s (FSA) decision to stop Pritchard carrying out business.

Leave a comment!

Please sign in or register to comment. It is free to register and only takes a minute or two.
Citywire TV
Play HSBC's Stephen King warns of 'enormous' Brexit deficit danger

HSBC's Stephen King warns of 'enormous' Brexit deficit danger

Brexit will weaken the economy, fail to boost exports and lessen the country's ability to fund its 'enormous' deficit, according to HSBC's senior economic adviser Stephen King.

Play Premier's Smith: electricity and water can be a good mix

Premier's Smith: electricity and water can be a good mix

Exposing your person to electricity and water simultaneously is ill-advised, but what about your portfolio?

Play Citywire 10k: video highlights

Citywire 10k: video highlights

Citywire held its sixth annual charity run last week, which hosted over 200 people and raised £14,000. Here are the video highlights.

Your Business: Cover Star Club

Profile: gearing up for the shift from consolidation to start-ups

Profile: gearing up for the shift from consolidation to start-ups

‘I think the industry is evolving rapidly, but not necessarily as a whole,’ says the head of recently launched Charles Nicholson AM

Wealth Manager on Twitter