Can retail investors solve the SME funding gap? Sharemark launches primary fund-raising platform

Monday, Jul 04 2011 by
Can retail investors solve the SME funding gap Sharemark launches primary fundraising platform

Marketwatchers and investors in the SME space will be interested to see the latest venture announced by Sharemark to provide small and medium sized businesses access to a fundraising channel aimed at retail investors.  There has been much talk of late here and elsehwere as to the difficulties faced by SMEs when looking to raise finance. Likewise, all too often private investors are neglected from company fundraisings which instead instead on raising institutional funds through placings. However, this summer, HM Treasury plans to implement the doubled Prospectus Directive limit.

In response, Sharemark is augmenting its existing secondary market activities to allow smaller firms the opportunity to raise between €500,000 and €5m of primary fund-raising on its platform. Investment on the market will be channelled through The Share Centre (LON:SHRE), Sharemark’s parent company, as well as a number of third party brokers. Lesmoir-Gordon, Boyle & Co will provide corporate finance expertise; while legal expertise will be provided by Squire Sanders Hammonds. SMEs will also receive access to up to £10m bank debt through Clydesdale Bank under the same due diligence process.

Gavin Oldham, Chief Executive of The Share Centre, said:

“This venture from Sharemark offers a timely solution for SMEs whose growth has been held back through the restricted lending opportunities available. It also provides retail investors, who have generally been denied access to new issues over recent years, with an excellent chance to share in this success by being able to invest in the companies, free of both dealing commission and stamp duty".

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Share plc is a United Kingdom-based company, which is engaged in stockbroking related activities. The Company's principal business includes its subsidiary, The Share Centre Limited, which is engaged in retail stock broking. It is also engaged in fund administration business through its subsidiary, ShareFunds Limited. It operates in two segments: The Share Centre, which provides stock broking and custodian services to retail investors, and Sharefunds, which operates a fund administration service. The Sharefunds segment provides a range of administration services to the authorized funds. Its subsidiaries include The Share Centre (Administration services) Limited, which is engaged in providing administration services; Share Nominees Limited, and Sharesecure Limited. The Share Centre Limited provides services to personal investors on a self-select basis, including account types, such as share accounts, self-invested personal pension and individual savings account. more »

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4 Comments on this Article show/hide all

marben100 5th Jul '11 1 of 4

So, what will be the mechanism for private investors to get involved? I don't see any detail on Sharemark's website.

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MadDutch 5th Jul '11 2 of 4

I support Sharemark in this. They have been my share club's brokers for 13 years, and have been excellent.

I wish them good fortune in providing a service that the banks seem incapable of providing.


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Sharemark 6th Jul '11 3 of 4

In reply to marben100, post #1

Sharemark will be launching this service to retail / private investors in the next few weeks. We will update our website with instructions when it is launched. Thank you for your interest.

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marben100 6th Jul '11 4 of 4

In reply to Sharemark, post #3

Thanks. I agree with MadDutch that this is an excellent and much needed initiative and look forward to hearing further details.



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