Chalk it up to the high costs for a tiny company to trade on the public markets.
Lake Forest-based MAI Systems Corp. recently pulled the plug on its stock listing on the over-the-counter stock exchange.
The move still is needs regulatory approval.
The company, which provides software and services for the hotel industry, recorded about $20 million in sales last year. It’s been publicly traded since the mid-1990s, according to filings with the Securities and Exchange Commission.
Though MAI will lose a key source of raising funds,selling stock,and possibly cut its visibility by going private, the move will “relieve it of the costs, administrative burdens and competitive disadvantages associated with operating a public company,” the company said in a release.
MAI said its audit fees rose 27% last year to $211,000, according to regulatory filings. Audit fee hikes increasingly have been tied to the cost of complying with the 2002 Sarbanes-Oxley accounting reform, which was created in the wake of scandals that hit Enron Corp. and others.
“(Going private) is an important step in the company’s future,” Chief Executive Brian Kretzmer said in a statement. “It allows the company to focus more time and energy on the growth and prosperity of our business and less on the reporting and compliance requirements of a public company.”
Executives with MAI couldn’t be reached for comment.
For more on this story, see the Dec. 12 issue of the Business Journal.
