A British car battery company led by former Tesla executives has quit the London stock market less than a month after tapping investors for £500,000.
DG Innovate (DGI), which is run by ex-Tesla director Peter Bardenfleth-Hanse, lashed out saying a lack of support for start-ups in the City had prompted the decision to abandon the main market and go private.
In particular, the company said red tape around London’s stock listing rules meant it was more difficult to raise money, which has hindered its attempts to grow.
However, the company had raised £500,000 from investors in early December, claiming the cash would keep it afloat until February 2025 and support a new joint venture with Indian firm Evage.
It also raised £100,000 in September.
Once the delisting is complete in early 2025, the business said it would propose a mechanism for existing investors – who will retain their stakes – to trade their shares privately.
Mr Bardenfleth-Hansen was appointed to lead DG Innovate in December 2023, alongside former Tesla executives Christian Eidem and Jochen Rudat.
Mr Bardenfleth-Hansen and Mr Rudat previously held senior roles at Tesla’s European teams.
Shareholders in DGI include Mr Eidem – a former adviser and classmate of Elon Musk – who owns 24pc of the business, and Norway’s largest bank DNB.
Following Tuesday’s announcement, the company said: “There has been and remains a broad lack of demand for exposure to companies at DGI’s current stage of development within the UK’s traditional institutional investor base.”
Bosses added that they did not “foresee any obvious near-term catalysts likely to change this backdrop”.
DGI shares collapsed by 75pc following the announcement, thereby reducing the value of the company to £2.8m from £12m.
Although DGI is a small company, the delisting marks a blow to the London stock market’s prestige as a place where small companies can access cash to grow.
Historically, companies have used the exchange as a means to expand. But three years of outflows from UK equity funds has left listed smaller firms starved of support.
A dearth of new listings has also weakened the London market given the surge in companies being taken private by foreign investors.
The London Stock Exchange changed its listing rules earlier this year to cut some of the burdens involved with a float, including making it easier to pursue decisions without the need for a shareholder vote.
Ironically, DGI took advantage of the latest change in rules to push through the delisting plan without shareholder approval.
Based in Wales, DG Innovate is developing batteries made from sodium as an alternative to lithium batteries which are more widely used in electric vehicles (EVs).
