Asset Match, a marketplace for UK unlisted companies, will host a series of share auctions in the Premier League team starting in March.

Tottenham Hotspur shares delisted from the AIM market in January 2012, with the club saying the listing restricted its ability to secure funding for development.

Since then, investors have been able to buy and sell shares via Capita, the club’s Registrar.

However, shareholders have raised concerns about the lack of transparency of this arrangement, according to Stuart Lucas, co-CEO of Asset Match.

“Neither buyers nor sellers can see any pricing and there are no details of completed transactions,” he said.

“Because of this they cannot be sure they are getting a fair price for their shares and this is causing liquidity issues for minority shareholders.”

Tottenham Hotspur has over 30,000 shareholders, of which more than 15,000 own just one ordinary share each.  The club is majority owned by Daniel Levy and Joe Lewis who together control approximately 85% of the shares in issue.

The first auction will open on Thursday 10 March, closing on Thursday 17 March

How the Tottenham Hotspur share auctions work

1. Current shareholders and prospective investors will need to register on the Asset Match website.
2. Once registered, participants will be able to place buy and sell limit orders when the auction opens on Thursday 10 March. During the period of the auction buyers and sellers are able to monitor progress and can adjust their bids and offers accordingly.
3. At the close of the auction a non-discretionary algorithm determines the final price and the number of shares that will trade. The indicative closing price is visible throughout the auction.
4. Subject to any demand or supply constraints, buyers with bids higher than or equal to the final price will be successful and sellers with offers lower than or equal to the final price will be successful.
5. All successful buy and sell orders are transacted at the same price and are settled via normal stockbroking arrangements. Asset Match can make arrangements with The Share Centre for shareholders who do not have an appointed stockbroker.

Should you buy shares in unlisted companies?

Asset Match is just one example of how technology is improving services for investors. But the platform is designed for unlisted shares, and with this comes a number of risks.

One of these issues is illiquidity, something Asset Match hopes to improve by offering periodic auctions rather than continuous trading.

Investment expert Adrian Lowcock of Axa Wealth, says: “The platform does not address the liquidity issues outright, just improves them.”

Valuing the company can also be difficult as unlisted companies are not as robust on financial reporting.

There is also major shareholder/owner risk to consider.

“If the private company is has a larger owner they control the business and make all the decisions as a minor shareholder you would have little say,” Lowcock says.