London-listed engineering business Torotrak has certainly taken a wrong turn somewhere, as its market cap was halved today upon the announcement that it had failed to secure a refinancing.
Torotrak, which focuses on emissions reduction and fuel efficiency technology, said it had been “trying to secure a refinancing of the company to address its financial difficulties”.
However, in a statement today it added: “Unfortunately, this has not proved possible.”
Torotrak said the board was evaluating its remaining options, which consist of selling its assets – including technology and intellectual property – or appointing administrators.
Major shareholders, including US manufacturer Allison Transmission, investment manager Ruffer and Barclays Stockbrokers, look set to make substantial losses. Over the course of the last 12 months, Torotrak's shares have lost almost 99 per cent of their value.
Last week, it said that its deputy chairman Jon Hilton and chief technology officer Douglas Cross were demanding repayment of a £1.7m loan note. Torotrak said it was disputing the legitimacy o the note, but that the uncertainty had led to “uncertainty surrounding the refinancing discussions”.
Torotrak is part of the FTSE Fledgling index, listed on the main market but too small for the All-Share.