A British car battery company led by former Tesla executives has exited the London stock market, less than a month after tapping investors for £500,000.
DG Innovate (DGI), which is led by ex-Tesla director Peter Bardenfleth-Hanse, hit out that a lack of support for start-ups in the city had prompted the decision to leave the main market and go private .
In particular, the company said red tape around London’s listing rules has made it harder to raise money, which has hampered its efforts to grow.
However, the company had raised £500,000 from investors in early December, claiming the money would keep it afloat until February 2025 and support a new joint venture with Indian firm Evage.
£100,000 was also raised in September.
Once the delisting is complete in early 2025, the company said it would propose a mechanism for existing investors – who will maintain their stakes – to trade their shares privately.
Mr Bardenfleth-Hansen was appointed leader of DG Innovate in December 2023, together with former Tesla executives Christian Eidem and Jochen Rudat.
Mr. Bardenfleth-Hansen and Mr. Rudat previously held senior positions in Tesla’s European teams.
Shareholders in DGI include Mr Eidem – a former advisor and classmate of Elon Musk – who owns 24% of the company, and Norway’s largest bank, DNB.
Following Tuesday’s announcement, the company said: “There has been and continues to be a broad lack of demand for exposure to companies at DGI’s current stage of development within Britain’s traditional institutional investor base.”
Bosses added that they did not foresee “any obvious near-term catalysts that could change this backdrop”.
DGI shares fell 75% after the announcement, reducing the company’s value from £12m to £2.8m.
Although DGI is a small company, the delisting is a blow to the prestige of the London stock market as a place where small businesses can access cash to grow.
Historically, companies have used the stock market as a means of expansion. But three years of outflows from UK equity funds have left listed smaller companies without support.
A lack of new listings has also weakened the London market, given a surge in the number of companies being taken private by foreign investors.
The London Stock Exchange changed its listing rules earlier this year to reduce some of the burdens associated with a float, including making it easier to make decisions without the need for a shareholder vote.
Ironically, DGI took advantage of the latest rule change to push through the delisting plan without shareholder approval.
DG Innovate, based in Wales, is developing batteries made from sodium as an alternative to lithium batteries that are more widely used in electric vehicles (EVs).
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