Mike Ashley-backed Hornby to go private as it ditches stock market listing

Hornby, the global models and collectibles group advised by Mike Ashley, has revealed plans to delist from the London stock market and go private.

The move aims to circumvent regulatory obstacles and reduce costs, as reported by City AM.

In a statement to the market on Thursday, the company announced its intention to cancel its shares on the AIM stock exchange, citing the high cost of maintaining a public listing, limited liquidity, and regulatory burdens.

Over the past 12 months, Hornby's shares have plummeted by 50%.

This decision follows significant restructuring at the company, which has been collaborating with Frasers' founder and stakeholder Mike Ashley on a turnaround strategy for the past 18 months.

Key aspects of this turnaround have included the sale of subsidiary LCD Enterprises, job cuts, and the relocation of logistics operations to the Midlands.

In a statement, Hornby acknowledged the significance of its announcement, particularly for its loyal shareholder base. "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," Hornby said.

"The directors are confident that operating as a private entity will provide Hornby with the necessary agility for swift decision-making and efficient execution of strategy whilst not depriving shareholders of material benefit."

To proceed, Hornby's board requires shareholder approval, which will be determined by a 75% majority vote at a general meeting scheduled for Thursday morning. If the resolution is passed, Hornby has agreed to two share facilities to support investors looking to trade out of their shareholding following any cancellation.

This announcement on Thursday marks another setback for London's struggling AIM market, which has witnessed a rise in delistings in recent years. In 2024, AIM contracted to its smallest size in 23 years with 92 firms delisting.

Phoenix Asset Management Partners, Hornby's largest shareholder, increased its stake in the firm from 71.6 per cent to 83.3 per cent in December. Russ Mould, investment director at AJ Bell, stated that its decision to delist was "not a damning criticism of the UK stock market."

He added: "When two shareholders – Phoenix Asset Management and Frasers – own 91 per cent of the company, it doesn't make sense to be a listed entity."

He further explained: "Companies admit their shares for public trading to obtain a diverse shareholder base and access capital markets. In Hornby's case, its shareholder base has become incredibly concentrated."