Eurozone crisis puts squeeze on AIM listings
Your support helps us to tell the story
From reproductive rights to climate change to Big Tech, The Independent is on the ground when the story is developing. Whether it's investigating the financials of Elon Musk's pro-Trump PAC or producing our latest documentary, 'The A Word', which shines a light on the American women fighting for reproductive rights, we know how important it is to parse out the facts from the messaging.
At such a critical moment in US history, we need reporters on the ground. Your donation allows us to keep sending journalists to speak to both sides of the story.
The Independent is trusted by Americans across the entire political spectrum. And unlike many other quality news outlets, we choose not to lock Americans out of our reporting and analysis with paywalls. We believe quality journalism should be available to everyone, paid for by those who can afford it.
Your support makes all the difference.The eurozone crisis has heaped pressure on the junior AIM stock market, with 24 companies quitting and just 16 joining in the final quarter of 2011. That compares with 22 departures and 26 arrivals in the third quarter, according to UHY Hacker Young.
In the whole of 2011, there were 69 new listings against 65 the year before, and the number of departures dropped from 158 to 116. Several more companies cited "financial stress" as their main reason for quitting AIM.
Laurence Sacker at UHY Hacker Young said: "Although AIM has clearly pulled through some very difficult times, it has not been immune to the current problems with the euro. In the short term, a full recovery in the IPO market seems unlikely. Investors have retrenched into defensive assets and until they have confidence that politicians have fixed the eurozone crisis once and for all, they are unlikely to return to the AIM market en masse."
The accounting firm said nearly four in 10 of the companies that left AIM did so through takeovers, with many unable to raise fresh funds on the market through rights issues or share placings.
Mr Sacker said: "Those companies that were unable to raise the funds they needed through secondary issues may have been more likely to succumb to takeover bids."
The total raised by new issues was down 44 per cent from 2010. The amount raised through flotations fell to £513m in the 11 months to November 2011 from £908m.
Join our commenting forum
Join thought-provoking conversations, follow other Independent readers and see their replies
Comments