The Business Magazine has published a new AIM list in the November/December edition of the magazine. The list of Thames Valley companies that are on the Alternative Investment Market is available here.
‘Keep calm and carry on’ if you are AIM-ing for growth
Reading: That was the underlying message from expert speakers at a recent (November 22) breakfast seminar who suggested AIM*-listing is a good place to be for ambitious, but Brexit-concerned, Thames Valley companies seeking funding to grow.
There were three key reasons, writes journalist John Burbedge, for their support for businesses to seek inclusion within London’s AIM market:
- A proven market. While London Stock Exchange Group expert Claire Dorrian admitted that there was a slight Christmas-New Year surge, perhaps to get some companies to the pre-Brexit AIM market, she also noted the long-term strength of AIM. Formed in 1995 with just 10 companies it is now the world’s most successful and established market for growth companies– having supported almost 4,000 companies to raise over £110billion. AIM’s supportive ecosystem and wide variety of market sectors also made it a robust proven market.
- A strong and varied funding market. As stockbroking and corporate adviser Andy Crossley of Stockdale Securities pointed out, there is at present ample financial capital available within UK, European and worldwide funding sectors to support business growth. Often a key corporate task today was deciding the right money, of the right sort at, the right time. The choice didn’t always have to be banking debt or PE involvement. AIM provides different supportive funding routes, regulatory confidence and yet options for the evolution of a company.
- Never a better time? Since becoming ‘investor ready’ will take time – an IPO process may take between 12-24 months, presenters mentioned – maybe, despite Brexit, it is never a bad time to get prepared? After all, such preparation will invariably produce and present a business-fit operation, able and ready to adapt to change.
Both Robin Stevens, corporate finance partner for Crowe, and Daniel Bastide of Irwin Mitchell highlighted, the need for businesses to spend time and prepare well, with the help of accountants and lawyers to support presentations to potential investors and, of course, the IPO approach to AIM.
Neil Clark, CEO of Destiny Pharma later described the route to his own company’s successful AIM-listing.
For full details about the seminar presentations click here.
*AIM is an alternative investment sub-market of the London Stock Exchange. It allows smaller companies to float shares with a more flexible regulatory system than is applicable to the main market.
Supporting Thames Valley companies 23 years on
The world’s most successful growth market and home to no less than 70 Thames Valley-based companies, AIM, turned 23 this year. As it celebrates another milestone, it is an opportunity to shine a light on regions such as the Thames Valley and the companies contributing to the market’s success, writes Claire Dorrian, senior manager, primary markets, London Stock Exchange Group.
Today, the area’s AIM companies have an aggregate market capitalisation of over £7.5 billion and an average individual value of £100 miilion, which is double 2016’s figures, demonstrating the growth of the region.
Companies come from across all sectors, from retail, to manufacturing and biotech. This not only reflects the growing number of successful entrepreneurial businesses flourishing across the region but also AIM’s ability to support more mature companies.
In August this year, Oxford-based healthcare technology company, Sensyne Health, joined AIM, raising £60m with a market capitalisation of £225m. It is just one of the 29 successful initial public offerings, including games developer Team 17 and egg-free cake producer Cake Box, we’ve seen on AIM in 2018 so far.
And despite volatile economic market conditions, over 70% of these stocks are currently trading up, with average post IPO performance running at 20%. They have an average market capitalisation of approximately £108m, a stark difference compared to a decade ago when the average value of new companies joining AIM was £17m.
Again, these 29 companies show the market is stepping up, particularly post the financial crisis. While we’ve seen other global markets struggling, AIM has in fact been outperforming the Main Market in some key respects. A third party report on AIM dividends this year highlighted that AIM dividends tripled between 2012 and 2018, almost three times faster than main market dividend growth.
That’s not to say that investment in the financial markets doesn’t carry risk. When investing equity capital there is always an evaluation of risk versus reward, but this is a feature of any investment on any market. Through venues like AIM, London Stock Exchange is committed to giving investors the opportunity to have a stake in innovative ambitious companies that will shape the future of our global economy.
AIM is a tremendous success story for the Thames Valley region and Britain as a whole, re-balancing the economy away from debt towards equity and boosting access to vital growth finance for thousands of ambitious businesses. Equity funding is the right sort of capital for these companies because they should be spending as much as they can to innovate, grow and create jobs, rather than having to prioritise servicing a loan.
Figures for the latest year available on AIM’s impact on the wider economy show companies which raised capital on AIM, created 731,000 jobs, paid £2.3b in tax and contributed £25b alone to UK GDP.
In June 1995, the market was launched with just 10 companies and an aggregate value of £82m. More than two decades on, AIM is now the world’s most successful and established market for growth companies, having supported close to 4000 companies raise over £110b. As it continues to connect thousands of smaller companies to capital, support the wider UK economy and develop in its own right, we must ensure AIM carries on thriving and supporting companies from the Thames Valley region and beyond.