The leisure group that owns the 126-year-old Brighton Palace Pier is planning to delist from the London stock market and return to life as a private company, in the latest blow to the capital’s junior market.
Brighton Pier Group, which also owns several bars and mini-golf sites around the country, told investors it intended to cancel its listing on the capital’s Alternative Investment Market (Aim) after more than 11 years, blaming bad weather, falling consumer spending, rising wage costs and higher interest rates.
The news led to shares in the company tumbling by as much as 60% during morning trade on Wednesday.
The group, which is chaired by the business veteran and former Pizza Express and Patisserie Valerie boss Luke Johnson, said it had faced “persistent challenging trading conditions” since the coronavirus pandemic, forcing it to cut costs and sell off underperforming assets.
In a statement to the market, the group said it had carried out “a careful review of the benefits and drawbacks” to the company and its investors of remaining listed on Aim, adding that it believed it was in the “best interests” of the business to return to private hands.
Shareholders will be given the chance to vote on the plans at a meeting on 22 April, where approval of at least 75% of investors is required. If they vote in favour, Brighton Pier Group will delist from the London Stock Exchange on 2 May.
Johnson owned 27% of the company’s shares, according to its most recent annual report, for the year to 24 December 2023, and was paid a salary of £20,000 for the role.
The delisting would be another setback for the London stock market, which has been hit by a string of departures in recent months.
According to the latest figures from the accountancy group UHY Hacker Young, 71 companies delisted from Aim in the year to 12 February, leaving fewer than 700 companies listed on the market, the lowest level since 2001.
The model train maker Hornby said in March it would cancel its listing and go private, saying it would help to cut costs and reduce its regulatory burden.
Brighton Pier Group, which also owns Lightwater Valley Family Adventure Park in Yorkshire, said it was looking to delist partly because of the “disproportionate” annual costs of between £250,000 and £300,000 connected with remaining listed on the stock market, and said it could use the money to invest directly into growing the business.
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The group also blamed lack of liquidity on Aim, which it said meant shareholders could not trade in “meaningful” volumes, and which also resulted in market volatility.
It came as Brighton Pier Group said its results for the year to 29 December 2024 were in line with market expectations.
However, it said the cost of living crisis was having a “material impact” on consumer spending, as people cut back on non-essential purchases. Sales fell slightly over the past 12 weeks compared with a year earlier, although Brighton Pier reported an increase in visitor numbers thanks to warm weather in March.
