London’s market stability is under scrutiny following Quantum Exponential’s decision to delist.
- Trading of Quantum Exponential shares ceases on 30 October, impacting investor confidence.
- The company’s public status hindered securing new investors despite noted interest.
- Geopolitical and economic shifts affected liquidity and valuations.
- Quantum Exponential joins other British tech firms transitioning to private ownership.
Confidence in the London financial markets is experiencing another test as Quantum Exponential Group, a notable small-cap tech investor, announced plans to cease trading its shares. The decision follows a resolution passed at a general company meeting, and trading will officially conclude at the market’s close on 30 October.
Since its IPO, Quantum Exponential has struggled under its public company status. The company cited that being listed has impeded its ability to attract new investors, even in the face of ‘serious’ interest from potential backers. Economic and geopolitical uncertainties have exacerbated these challenges, contributing to a decline in general liquidity and valuations for micro-cap firms.
Quantum Exponential’s share value has plummeted by over 90% since its initial public offering, reaching a peak in November 2021 at 6.875p. Despite this setback, the group has been active in supporting early-stage companies within the quantum computing sector. Its investments include startups such as AegiQ, QLM Technology, Universal Quantum, and participating in significant funding rounds like Oxford Quantum Circuits’ $1.1m bridge round.
The trend of transitioning away from public markets is not isolated, with Quantum Exponential joining other British tech companies opting for private ownership. Manchester-based C4X and fintech firm Tintra have also recently delisted, citing difficulties in raising new funds in the UK public markets.
Despite positive remarks from its CEO, Steven Metcalfe, regarding the strong momentum in quantum investments, Quantum Exponential reported nearly £2m in pre-tax losses for the year ending April 2023, a stark contrast to its modest profit in the previous year. The company’s asset values also saw a significant decrease from £5.7m to £3.8m during the same period.
Quantum Exponential’s transition to private ownership underscores the broader challenges facing London’s small-cap tech sector.
