Annual AIM seminar: November 2017
Charles Russell Speechlys Partner Chris Putt was joined by guest speakers Marcus Stuttard, Head of AIM at London Stock Exchange, and Paul Stevens of BGF Quoted.
Marcus gave a summary of the past year’s AIM Market trends. He reported that investment remains healthy, with £900 million raised through further issues in October alone bringing the total money raised on AIM to £4.8bn so far in 2017. Even in light of continued Brexit uncertainty, and the re-emergence of other European growth markets, AIM attracts a significant number of international companies and investment and accounts for 70% of capital raised across all European growth markets. Where historically there has been a shortage of early stage equity finance, the overall financing environment has improved in the UK over recent years and, companies are now actively seeking out the benefits of a public listing including AIM in particular.
Marcus referred to AIM’s recent survey and discussion paper as an opportunity to listen to the directors of listed companies, brokers and other members of the AIM Community and to build consensus on how to shape the market in the future. Collateral such as the “guide for entrepreneurs” addresses practical considerations and decisions that business owners face from their perspective rather than a more technical overview of the rules. London Stock Exchange’s new issuer services platform will look to support AIM and Main Market companies with tools and resources to help them further develop their businesses.
Paul Stevens introduced BGF Quoted as the quoted company arm of the Business Growth Fund. BGF is the most active investor in the UK and was founded by 5 banks pledging £2.5 billion to invest in UK growth businesses. Their 180-company portfolio is made up of businesses from early stage to listed businesses over a wide range of sectors. He highlighted some key areas as to how BGF function in the AIM ecosystem:
- The offer of long-term “patient” capital with a broad mandate and without the pressure of exit deadlines
- The ability to provide both equity and unsecured debt which minimises dilution as well as funding a partial sale by existing shareholders as part of a funding round
- Certainty of funds which reduces fundraising and stakeholder risk, working alongside tax-efficient funding
- An unparalleled network of management personnel to assist boards on a multitude of issues
Marcus highlighted the importance of institutions such as BGF on AIM. Institutions bring confidence to the market because of their long term investment horizons and detailed knowledge of the market and key stakeholders. In turn, this encourages individual investors, who help to increase liquidity.