Taking AIM 2011 - Key Findings

Download a copy of the Taking AIM Key Findings 2011.

Download a copy of the Taking AIM Executive Summary 2011.

This week sees the publication of the fifteenth annual Taking AIM survey published by Faegre & Benson in partnership with Baker Tilly accountants.  The survey shows that AIM bounced back in 2010 with its index increasing by 43%, whilst the FTSE 100 only increased by 8%.  Secondary fundraisings held up well at £5,738 million (£4,861 million in 2009) demonstrating the maturity of AIM as a growth company market with considerable support by investors for existing listed companies.

Although IPOs increased significantly to 47 (13 in 2009), underpinned by 26% in the resources sector, this level is still a far cry from 2006 when there were 326 IPOs. Only the very best companies were able to complete an IPO as institutional investors, often with reduced funds available, preferred to support their existing portfolio companies or seize opportunities with other companies already listed.

Smaller, weaker companies continued to delist and the total number of companies on the market again fell, albeit at a lower rate to 1,195 (1,293 in 2009). The average market capitalisation increased, however from £44 million to £66 million, yet again demonstrating a more streamlined but arguably stronger AIM market.

Despite a year of continued economic hardship and investor caution we are pleased to see positive results in this year's Taking AIM survey from both companies and investors, in particular:

• the vast majority of current AIM-quoted companies (71%) support the market, saying that, if they had known about the recession, they would still have joined
• 80% of investors said AIM's performance during the year had a positive effect on their own fund's performance
• 80% of AIM companies say they have seen some benefit from the access to capital their listing provides, with 48% considering this to be a major benefit
• 56% of AIM companies said they had considered, or were considering, AIM for further fundraising in the next 12 months
• 60% of investors and 63% of AIM companies expect to see further improvement in AIM's performance over the next 12 months.

In 2011 so far, most advisers are seeing a greater number of companies seeking an IPO, which is not surprising.  We are now in the fourth year of recession and with banks still not widely open for business, companies which seek to develop are likely to look to the equity markets for new funding. Whether this increased demand will be matched by investor appetite is still uncertain.