aim Growing with direction
With alternative investment high on many company agendas, 83 business executives, directors and professionals met in November at the Madejski Stadium in Reading for the Thames Valley AIM Seminar, ‘Funding Growth in Challenging Times’, where they learned that flotation is just as much about finance, as strong relationships and common sense.
The morning seminar was hosted by The Business Magazine, which published a listing in its November issue featuring more than 50 businesses in this region on the AIM market.
The event was supported by the London Stock Exchange, Crowe Clark Whitehill, Cantor Fitzgerald and Business Growth Fund (BGF), and delegates heard speakers from each of these organisations.
Claire Dorrian London Stock Exchange
requires a change of mind-set. However, being publicly listed brings a lot of benefits around customer interaction, retaining staff, marketability of the company and acquisition opportunities. And from the UK perspective “we’re fortunate in having a great regulatory system”.
Considering the benefits of joining AIM, she cited the example of Hotel Chocolat, which joined this year and is already outperforming market expectations.
For companies considering an AIM listing she introduced the Elite Programme, a business education support programme.
She said: “At AIM we sit at the heart of the financial system from a public market perspective, with a whole network of advisers and investors. We felt we could use this to add value to private companies as they navigate their growth, and launched the Elite Programme in response. It has been going for two years, and there are already over 90 companies involved across a wide range of sectors.
“This is an interesting and diverse range of companies – they come on board for an 18-month period, and get access to various workshops and sessions, and we draw on our partners to help and support that. It’s not an IPO programme – it’s more about us having a role to play in supporting growing companies.”
First up, Claire Dorrian, senior manager of the London Stock Exchange, gave the audience an update on the state of the AIM market today. She said that while the main market has seen some fluidity post- Brexit, AIM has stayed resilient. Described as the world’s most successful growth market, it has seen more than £98 billion raised by more than 3,600 companies since its launch in 1995.
She said that some companies shy away from the transparency of listing, and it
Dorrian said the set of rules in listing on AIM are fairly flexible; the practice is around investors’ expectations. You wouldn’t bring a business to market at a low market cap, for example. “Looking at the distribution of market cap among listed companies, you really want to sit in the middle so you are attractive to the right type of investors. This is where the Elite Programme is positioned – to help put companies in the best possible position to access finance, and to be on the radar for the right type of investors.”
Representing accountancy firm Crowe Clark Whitehill was partner and head of capital markets Robin Stevens, who spoke about becoming investor ready.
His key message was that moving a privately- owned company to a public market takes time, and that detailed planning is needed. He said in theory you can do an IPO in four months, or even three; before that is planning. “And the earlier we are involved in talking to a client the better. Flotation takes time, don’t rush it.”
Another key message was on valuation: “Go in at a value you can go up from … so people still see it as a good value investment,” and he warned that companies might need to adapt to more realistic expectations when they come to market.
Asked about ‘red-light situations’ he said a common stumbling block is where a client doesn’t take advice. Are they really prepared to move away from being a private family company to being a public company, he asked? Are they prepared to take advice and listen, or are they coming just to hear what they want to hear? Because they can’t just run the company the way they did before. So this willingness to be advised is very much about the chemistry of the team.
Looking at sector success, Dorrian had mentioned that the tech sector is currently the most prevalent. Adding to this, Stevens said:
seminar
AIM. What a great acronym – a word that says focus, direction, vision and goals in just three letters, writes Carry de la Harpe. It might be luck, it might be good thinking, but either way, right on the mark for the world’s most successful growth market … and the companies listed that are living examples of these ‘on target’ qualities
Robin Stevens Crowe Clark Whitehill
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businessmag.co.uk
THE BUSINESS MAGAZINE – THAMES VALLEY – DECEMBER 16/JANUARY 17
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