Iconic collectables firm Hornby has announced it plans to return to private ownership and remove its shares from the stock market.
Shares in the Margate-based company have long been traded on London’s Alternative Stock Market (AIM) but have shrunk in value over recent years.
Now company bosses say going private once again will provide the firm with the “necessary agility for swift decision-making and efficient execution of strategy”.
Existing shareholders will be invited to a meeting at its Thanet home on April 1 to vote on the proposals. The motion to delist will need at least 75% approval. If approved, shares will come off the market by the end of April.
Among its shareholders are Mike Ashley’s Frasers Group which last year upped its stake in the company to just below 9%.
It’s single biggest shareholder is investment firm the Castelnau Group which owns 54.9% of the firm.
Richard Brown, CEO of Castelnau, said: “Castelnau views Hornby as an important part of our investment portfolio and we are working closely with the management team to support its transformation.
“Given the extensive operational changes being implemented, we recognise and support the Hornby board’s recommendation for the cancellation. We believe this decision will benefit all stakeholders and enable Hornby to realise its full potential.”
Hornby is continuing down a route of restructuring, which has included job losses – it saw “significant headcount reduction in the Margate head office” last September and the relocation of its logistics operation from Hersden, near Canterbury, to the Midlands.
In September, its financial figures for the previous six months saw its revenues increase – but pre-tax losses widen to more than £5 million.
However, it has continued to look to strengthen its portfolio – other brands in its stable already included the likes of Corgi, Scalextric and Airfix – with the acquisition of a stake in models firm Warlord Games, the acquisition of the Corgi Model Club and the sale of LCD Enterprises.
The company says it remains on track for year-on-year sales growth, but warned of weaker trading so far this year with shipping delays having an impact.
The company said: “The board is well aware of the place Hornby has in the hearts of its loyal shareholder base, and the company’s announcement today is not taken lightly.
“The directors have conducted an in-depth review of the advantages and disadvantages to the company and all its shareholders in retaining the company’s quotation on AIM. Following this review, the directors have concluded that the cancellation will be in the best interests of the company and its shareholders as a whole.
“It is the board’s view the cancellation will provide greater strategic flexibility and that Hornby can take and implement decisions more quickly than a company which is publicly traded as a result of the more flexible regime that is applicable to an unquoted company.”
Hornby is not the first firm to quit AIM this year. In recent days, winemaker Gusbourne, based in Appledore, has confirmed it is delisting and returning to private ownership – citing many of the same reasons.
Last year, 92 firms also came off the market.