The London Stock Exchange has recently adopted new rules to make it easier and faster for overseas companies to join its international small-cap market -- the Alternative Investment Market, or AIM. U.S. companies should take note. Listing on AIM provides entry to institutional investors from around the world, as well as access to the world's largest pool of investment capital next to New York.
The new rules are part of an ongoing effort to attract rising overseas companies to AIM. They allow companies whose shares are already traded on the "designated markets" of Nasdaq and the New York Stock Exchange to use their existing annual report and audited accounts as a basis for listing on AIM also. The new fast-track route to AIM also applies to companies listed on seven other "designated markets": The Australian Stock Exchange, Euronext, Deutsche Borse, JSE Securities Exchange (South Africa), Stockholmsborsen, Swiss Exchange and Toronto Stock Exchange.
Over 700 companies are now traded on AIM, including eight U.S. companies. AIM hopes to encourage listing by companies in the life sciences, technology, gaming and natural resources sectors. Would listing on AIM benefit your company?
Advantages of AIM
London is the most international of the world's three primary financial centers, and the London Stock Exchange, which is the largest in Europe, has more foreign company listings -- 522 from over 60 countries -- than any other exchange in the world. London turns over more foreign equities than any other market, and leads also in international bonds. And London stands pre-eminent as Europe's financial capital. Listing on AIM provides entry to this diverse and dynamic marketplace as well as more specific benefits.
AIM has no specific suitability criteria. Instead, the central requirement for admission is the appointment by the company of a nominated adviser to perform due diligence and certify that the company is appropriate for AIM. Nominated advisers are selected from a list of corporate finance firms approved by the London Stock Exchange. The nominated adviser also assists the applicant company through the admission process, and is responsible for advising and guiding the company's directors on compliance with AIM rules and disclosure obligations on an ongoing basis. Other listing requirements include:
U.S. companies can access a rich and diverse additional market for their shares by listing on AIM. The new rules make listing fast and easy, and therefore entry to London's international marketplace less costly, for qualifying companies interested in using AIM to boost their future growth.