Investment fund managers aren’t very interested in the London Stock Exchange’s plans for a newmarket for small cap companies called Techmark, though the potential issuers were more supportive, a survey by investment bank Granville Plc has found.
Granville’s managing director for the hi-tech sector, Richard Donner, said the results were not too surprising, in that, for the fund managers, another market will mean more possibilities to be considered for potential issues, whereas for the companies themselves it will represent a further potential source of funding.
The lukewarm reaction from the fund managers should cause concern to the LSE, Donner went on, as it indicates that the exchange’s ‘less than tremendous record in innovative solutions’, particularly the lacklustre Alternative Investment Market (AIM), may have predisposed the market against further initiatives.
The LSE will say only that details of Techmark will be revealed when it is formally launched ‘within a month’, but the fact that London is trying to create a market specifically for small cap, high-growth companies in the hi-tech field is a positive one, Donner opined. However, he acknowledged that the move smacked of a reactive effort to the success of Frankfurt’s Neuer Markt, rather than a proactive one, and Granville, which is active among the kind of companies Techmark will be seeking to attract, remains skeptical as to the success of the undertaking.
