Stockbroker’s takeover at risk after London Stock Exchange refuses application

The deal by Ince Group to buy Birmingham stockbroker Arden Partners is in jeopardy after the London Stock Exchange decided not to approve the new application for Nominated Adviser (Nomad) status.

The planned takeover was revealed in October when the all-share offer was worth nearly £10m – but Ince’s falling share price means the deal is now valued around £5m.

In separate statements, both companies said they had “entered into discussions…regarding the implications of London Stock Exchange’s decision” and would provide an update shortly.

A Nomad advises a company when it lists on the Alternative Investment Market (AIM), as well as its continuing obligations once on market.

Arden has previously acknowledged there was a “significant risk” to Arden’s continued Nominated Adviser status should the Change of Control occur. The London Stock Exchange was assessing whether Ince satisfied the eligibility criteria for Nominated Adviser status in its own right.

Yesterday Arden was told that its new Nomad application had not been approved.

It is the second time the Nomad rules have created a major headache since the deal was announced.

One of the reasons for Ince’s lower share price was the impact of it having its own AIM listing suspended for a month after it tripped over the Nomad regulations.

Arden was Ince’s Nomad, and the takeover offer meant Arden had to resign the role with immediate effect. Ince’s shares were reinstated a month later when it appointed Allenby Capital.