OFEX listing benefits - an article by Ray Taylor, UK company director and business development consultant

Ofex listing - the benefits

By Ray Taylor

There are many benefits of becoming a company listed on OFEX. There are also many risks and disadvantages involved. So please take into account the downside of becoming an OFEX company

Not all of the following benefits will apply in any particular case and, in some cases the disadvantages may well outweigh the advantages. Conversely, a company might find even one or two of the reasons for listing to be persuasive in their particular case.

Benefits of listing on OFEX might include:

In order to raise equity finance in an organised way
To provide a level of protection for shareholders
To increase confidence in the enterprise among shareholders
To provide small shareholders with an immediate and simple exit option
To provide an eventual exit path for executives and major shareholders
To provide existing shareholders with a facility to top up their shares at any time they want
To provide opportunities for people you have never met to take an interest in your company and perhaps become a part of the success story
To provide the means to raise further equity finance in the future if required
To impose a discipline on the proper management of the company
To provide guidelines to directors as to how the company should be run
To provide real, long-term equity incentives to staff
To provide additional equity incentives to management
To provide the means for shareholders to take advantage of various tax concessions offered to shareholders of smaller companies
To reward friends, colleagues, client and others who have helped you get where you are
To provide a higher profile and a greater level of visibility for your business
To demonstrate commitment to clients, suppliers, and other stakeholders
To help to create a cash reserve to underpin future growth
To provide working capital to help fund any cash-flow deficit and for other purposes
To provide the means of investment in research and development and other activities where the return is not immediate
To provide a higher level of career security to employees
To provide corporate information in a transparent and comparative way
Allows the owners of a business to work at it rather than playing at it
To avoid pointless speculation as to the true value of the enterprise

The downside of becoming an OFEX company

email: info@raytaylor.net

Ray Taylor is founder of eyeconomy, a company he launched on OFEX in 2000 before leaving the company - an investment business - in 2001. He is now chairman of Blue Strata plc and a non-executive director of a number of other UK companies