Delayed float adds to City gloom

FUEL cell technology firm Intelligent Energy has abandoned plans to float on the stock market later this month, sending a tremor through the City.

Financial analysts said the potential analysts had baulked at the price. Intelligent Energy had planned to raise £40-60m from the offering on Aim later this month, valuing the firm at about £200m.

Chief executive Harry Bradbury said the company would consider floating at a later date, either in London or New York. He blamed current market conditions for the decision.

Intelligent Energy's decision follows several other cancelled European flotations in recent months, including those of Germany's Siltronic and ATU. Other firms, such as sportswear supplier Umbro, have reduced the amount they raised.

The market for new issues has picked up this year after a three-year downturn, but geopolitical risks, rising interest rates and high oil prices have tempered investors' appetite for new stock.

Bradbury said Intelligent Energy had financing in place to sustain its business and that further funds could be raised through private placement.

Intelligent Energy specialises in fuel cells that use hydrogen for a chemical reaction to produce electricity. The basic technology is old, but increasing concerns about the pollutants in other fuels have led inventors back to the use of hydrogen as a fuel of the future in both static power generation and transport applications.

JP Morgan was nominated adviser for the offer and was to be joint broker with Evolution Beeson Gregory.

Analysts are divided about the potential impact on other new issues due to come to the market in London in the coming months.

Upmarket kitchen maker Smallbone plans to raise about £2.5m by listing on Aim, giving it a market value of about £15m. PlusNet Technologies, an internet service provider, is expected to be valued at between £30-40m when it lists this summer.

Monkleigh, a new company specialising in promotional events and and corporate hospitality firms, plans to raise up to £2.5m by listing on Aim later this month.

Financial services company Libertas Capital recently announced plans to raise up to £7m from its AIM listing and sales technology firm XN Checkout plans to raise about £5m from its own flotation on AIM later this month.

A main market float next month is Eurocastle Investment, a securities firm, expected to be valued at between £50-100m.