The Road to PLUS – Seminar Report
On a crisp spring morning, we gathered in the delightful surroundings of Homerton College, Cambridge to hear about how companies can prepare for a quote on PLUS Markets and the process for achieving a quote.
Paul Haddock, Head of Capital Markets at PLUS, spoke about the growth of PLUS over the last few years to a point now when it provides a broad range of services for companies of all sizes. In 2007, sixty new companies were admitted to PLUS-quoted and the number of PLUS-quoted companies is now well over two hundred. Companies are being attracted by the straightforward process and the tax advantages, and the market includes companies of various sizes up to £650 million market capitalisation, although the average market cap is around £8 million. Paul also stressed the diversity of the company sectors covered ranging from Telecoms, Media, Oil and Gas, Health, Transport, Support Services and Mining.
The next session covered the role of the PLUS Corporate Adviser, which every PLUS-quoted company is required to have. John Bridges, spoke about the importance of a strong client/adviser relationship and how the Corporate Adviser guides and assists the company through the process and identifies appropriate investors. The Corporate Adviser tries to ensure that the company maximises its chances of success with a PLUS-quite and has the management, infrastructure and governance in place to obtain and maintain a successful quote.
In the final session, Ash Mehta, Chief Executive of Orchard Growth Partners spoke about the challenges for companies targeting a PLUS quote and the matters that need to be addressed beforehand. These include the importance of demonstrating the credibility of the management team and good governance within the company, as well as making the story crystal clear for investors who will probably be generalists rather than sector specialists. It’s also important for the company to put in place processes beforehand to manage the company’s PR, and its investor relations to assist management of the investor base as a PLUS-quoted company. Finally there are the personal wealth and incentivisation aspects to be planned for including ensuring that key employees share in the success through sensible (and tax efficient) option schemes.
The key theme running throughout the seminar was that, despite the credit crunch and turbulent equity markets, the door is still very much open to quality companies wishing to obtain a PLUS-quote to drive their growth, but as always it requires good planning and the quote is not an endpoint but the start of the next phase of a company’s growth.
For further information on any of the issues covered in this article please contact:
Salah Mirza t: 0845 3700 303 e: salahm@orchardgrowth.com
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