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NZX minnows FMS, Windflow weigh up local listing

Tuesday 11th September 2018

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Future Mobility Solutions and Windflow Technology are among locally listed firms deciding their futures on the NZX. 

Auckland-based FMS, formerly Sealegs International, is less certain of plans to end its 24-year NZX listing in favour of joining London's AIM Market, due to the heightened uncertainty caused by Brexit. Meanwhile, NZX Alternative Market's Windflow will quit its 15-year run on the regulated bourse in November and plans to join the Unlisted Securities Exchange. 

A number of NZX-listed firms have been considering their options in recent months as the stock market operator plans to collapse its three boards into a single platform, introduce a higher listing bar and looser reporting rules in a wider suite of initiatives to boost liquidity. Firms that have committed to moving to the main board include Just Water International, Solution Dynamics and Foley Family Wines. 

FMS had planned to de-list, saying NZX was too small with thin trading liquidity. However, when seeking funds in a one-for-five rights offer, the maker of amphibious vehicles yesterday said the uncertainty created by Brexit meant the shift to London's AIM market wasn't a done deal and it's "also considering other options including the possibility of being dual-listed". 

The company is selling shares at 12.5 cents apiece to raise up to $3.7 million to repay debt and fund working capital. The shares last traded at 14.5 cents, with an average daily volume of 58,625 traded, or 0.04 percent of its issued stock. FMS shares first traded at 70 cents when listed in October 1994 and have gone through several rights issues, a share consolidation and a share cancellation. 

Separately, Christchurch-based Windflow announced plans to leave NZX, saying the listing fees are a "significant cost burden" for the turbine maker. It plans to shift to the USX and shareholders will vote on the issue at their October annual meeting. The company was censured by NZX Regulation in May for filing its 2017 annual report two days late and fined $25,000. 

The NZAX-listed shares last traded at 1.4 cents, with a daily average volume of 19,831 shares, or 0.02 percent of the issued stock. The company sold shares at $2 apiece in a 2003 public offer when Windflow shifted to the NZAX from the Unlisted market. It raised funds from investors five more times while listed on the NZAX. 

Windflow's move back to USX will ease the potential loss of ProTen, which is under takeover offer at the moment. The trading platform added Martin Jetpack in June, and last month said it had "a number of potential new issuers." It has also recently completed an internal approval process on one new issuer which it anticipates will commence trading in the next quarter.

NZX has gone through a dry spell for new listings over the past year and a half, with private equity investors flush with funds and an attractive alternative for some vendors. The stock market operator's listed equity securities fell to 141 in August, down 5.4 percent from a year earlier. Still, listed issuers have been keen to raise capital with $1.16 billion of equity raised from New Zealand issuers in the nine months to Aug. 31. Trading volumes have also been rising with an increased number of smaller value transactions going through the market. 


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