AIM is no longer a hothouse for those hoping to graduate to the main market,
a survey has suggested.
‘AIM’s days as a mere nursery to the main market lie far behind. Rarely now
do AIM companies bother moving over to the bigger market. Indeed, this year’s
survey of more than 200 AIM companies and over 50 AIM investors shows that AIM
is no longer seen as simply a rite of passage for growing companies looking to
list on the main market,’ according to Baker Tilly’s annual Taking AIM survey.
Last year AIM passed an important development landmark. It now lists more
companies than the main market (around 1,600).
Despite targeting higher-risk growth companies, its failure and profit
warning rates are comparable with its corporate peer. And on key measures like
market cap and turnover, as well as the number of new issues, the report showed
that it is outperforming not only the main market, but European and US peers
Baker Tilly expects international companies to provide an increasingly
important part of new issue supply.
Going forward, AIM will have to accommodate an increasing number of large-cap
companies, despite its background as a growth market. This could inadvertently
lead to a revival of transfers to the main market, according to some experts,
though AIM companies and investors surveyed believe moving is not a priority.
AIM’s performance was mixed in 2006. Measured by funds raised, which hit a
new high, last year was exceptional. The number of new offerings also remained
at a very high level, though down on 2005’s record.
However, the market’s key indices all fell, to the disappointment of
investors. This mainly reflected sharp declines in some large internet gaming
and mining shares, though a perceived decline in the quality of new issues
Other stocks and sectors recorded significant gains, reinforcing AIM’s
reputation as a stock-picker’s market.
Mark McMullen joins the private client services team from Smith & Williamson
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