Market wary of indies, warns Tinopolis boss

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Tinopolis executive chairman Ron Jones has warned that listed indies' acquisition strategies will be suppressed by a hostile investment market, as the Welsh super-indie prepares to delist from the Stock Exchange.

The producer, whose portfolio includes Question Time indie Mentorn, sport indie Sunset + Vine and Britz producer Daybreak Pictures, will complete its £44.7m sale to venture capitalist consortium Red Dragon Acquisitions Ltd, set up and advised by Vetruvian Partners, on 10 July.

All shares will be cancelled and the company will move into private ownership.

Jones told Broadcast that while the move would put the company in a better position to pursue its business plan, he would not be rushing into any acquisitions or new areas of business.

"We only went public in the first place because it was the most rational way of raising the money to develop the business - it was a financing decision rather than a way of funding acquisitions," he said. "But nine months ago, seeing the way the market was going, we saw it would make it more difficult for us to make cash if we remained public."

He said Tinopolis wanted to keep growing but would not pay any "silly prices" to do so.

"We're sticking to our old business plan," he said. "One thread running through the industry is that common sense pricing hasn't arrived. The market will come back to meet us."

Jones predicted that remaining public companies would find it hard to raise fresh equity for any acquisitions.

"For small cap companies, there's really no other way - they'll all have to consider this as a way of funding," he said. "Raising fresh equity won't be impossible but it will be difficult, as the investment market's disenchantment with the production sector will be with us for a while."

Jones was speaking as Tinopolis posted its final public financial report for the six months to 31 March. Pre-tax profits almost doubled from £960,000 to £1.7m year on year, though turnover was down 4% to £30.3m.

Sunset + Vine managing director Jeff Forster will join the Tinopolis board once it becomes private, while non-executive director Rhys Davies, who steered the acquisition, will step down.