AIM keeps second tier busy
Fast-growing and broad structure of AIM is providing a boom in IPO services for second-tier firms over their Big Four rivals.
BDO Stoy Hayward has laid claim to being the busiest reporting accountants for clients on the AIM, saying that it worked on more IPOs last year than any other firm.
The firm has calculated that it provided services to 36 of the new IPOs on AIM during 2004. Grant Thornton laid claim to 35, including reverse takeovers, while Baker Tilly said it completed 32.
The numbers are significantly ahead of rival IPO experts in the Big Four firms, and indicate the significant advantage that second-tier firms have in dealing with smaller-cap companies on AIM. Insiders believe that Big Four fees for an AIM listing can be up to double that of the average second-tier cost of £100,000.
Chris Searle, head of corporate finance at BDO, said: ‘AIM is a market for smaller, fast-growing companies. Our fee structures are better than the Big Four.’
AIM proved hugely successful last year, attracting businesses from the UK and overseas. In all, 333 companies joined the market in 2004, of which 226 were IPOs, raising a total of £2.6bn. By comparison, the London Stock Exchange’s main market saw just 65 new entrants, of which 49 were IPOs.
BDO believes its advantage over Big Four competition is also built on its ‘partner-led’ approach.
Chilton Taylor, head of capital markets at Baker Tilly, confirmed that the high level of partner involvement was crucial to winning market share.
‘We got into this area because it was a market for growing entrepreneurial companies who will not only provide audit work, but also on acquisitions and due diligence,’ he said.
Meanwhile Philip Secrett, a partner in the capital markets team at Grant Thornton, said the differentiation reflected diverging approaches between the Big Four and second-tier firms. ‘The Big Four are competitors and they are active, but AIM is a broad church,’ he said.