News blog
Griffin Group
- BY: Andrew Hore |
- POSTED: 12/02/2008 |
Corporate finance and shell company promoter Griffin Group says that lack of liquidity on Plus is making it consider floating larger shells on Aim.
Griffin has made a large chunk of its revenues and profits from floating shells and then selling its stake in the companies. Its net asset value of £3.64m includes £2.53m of tradeable investments.
The changes to the Aim rules in March 2005 meant that shells had to raise more than £3m in order to join Aim. Griffin started floating shells on Plus-quoted because of this rule change. However, Griffin has found it more difficult to raise money and the liquidity of the shares isn’t as good. Griffin can’t sell out of the companies as quickly as it did with its Aim shells.
Griffin is looking to combine launching its Plus-quoted vehicles with “special purpose acquisition vehicles that qualify for Aim”. These have to be much larger than the Plus-quoted shells so raising money could be difficult.
Turnover dipped from £8.83m to £6.74m in the year to September 2007, while profits fell from £614,000 to £364,000.
In 2005-06 Griffin floated or developed six companies and was involved in three reverse takeovers. Last year it floated two Plus-quoted companies and completed two reversals into Plus-quoted companies.
Management warns that it doesn’t believe it won’t be able to complete many transactions in the first half of this year – it has finalized one so far.
Last year Griffin raised £983,000 - £893,000 after expenses – via a three-for-two open offer at 1.5p a share. Net cash is £1.38m. NAV per share is 3.33p, while the shares are trading at 1.375p.
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