BDO UK has become the first sponsor to be
publicly censured by the Financial Service Authority (FSA).

The FSA said BDO did not satisfy the
requirements in its role as a sponsor on Shore Capital Groups
proposed merger with Puma Brandeburg Limited in 2009.

As Shore Capital’s shares were listed on the
Official List and traded on the London Stock Exchange, the
investment bank was required to suspend its shares when it had
confirmation the reverse takeover was to take place unless the UK
Listing Authority (UKLA) was satisfied there was enough market
information about the merger.

The FSA said BDO failed to liaise with the
UKLA and tried to avoid classifying the transaction as a reverse
takeover. The FSA said BDO agreed with Shore Capital that it should
delay contacting the UKLA until after announcing the merger was to
take place.

“Sponsors provide important protections for
investors and the market under the listing regime. They are
entrusted to provide sound and expert guidance to issuers on their
obligations and are relied upon to be open with the UKLA,” UKLA
head of department Marc Teasdale said.

“BDO failed in its responsibilities as a
sponsor on this transaction and we are sending a clear message with
this public censure about the importance we attach to the sponsor

BDO said it subsequently made changes to its
operations to ensure compliance with sponsor rules in the