Researcher forges LSE link
Article Date: May 19 2008Independent Investment Research (IIR) is to supply material on smaller quoted companies to the London Stock Exchange’s new PSQ Analysis arm.
The AIM-quoted research group has signed a memorandum of understanding with the LSE to join two other providers, Pipal Research of Chicago and Argus Research of New York, to supply PSQ with research on companies quoted on the Full List and on AIM. IIR expects the target companies to be offered this service for about £10,000 a year.
Shane Smith, IIR’s boss and largest shareholder, argues that the price should make it attractive to the many smaller companies now unhappy with the paucity of information and analysis on them in the market. Citing a potential market of about 1,000 companies, to be divided between IIR, Pipal and Argus ‘on a blind pool basis’, he says the economies of scale should enable PSQ to undercut existing research groups and still make money for its own providers.
‘We’ve been scaling up for this for a year’, explains Smith. He argues that research commissioned by the LSE shows that 82 per cent of smaller quoted companies are dissatisfied with the information now provided about them and 66 of private investors are similarly discontented.
London-based IIR, which lost £503,000 on £922,000 turnover in the six months to August, has a turbulent history since floating on AIM in 2000. Some three years ago, the company was involved in an intellectual property row with the mighty Google and its shares, floated at 106p at the turn of the century, collapsed all the way to 6.13p in 2006.
They have perked up 5p today to 16.5p, valuing the company at a lowly £4.3 million. They could rally further if the PSQ deal wins the business Smith expects.
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