AIM companies need less oppressive rules and new innovation and investment

21 May 2004

Tweet
Facebook
LinkedIn
Google plus
Send to

Small-cap listed companies are at risk of losing out due to their lack of innovation in the field of new product development and a perceived low level of interest from institutional investors according to a recent survey from PKF. The report suggested that it is time for AIM to be further differentiated from other markets with distinct, more relevant rules as it enters its tenth year. A perceived lack of institutional investors was overwhelmingly named the main disadvantage to the AIM market by those companies surveyed that had moved from the Stock Exchange Official List to AIM. As a consequence, AIM companies want a re-assessment of the risk profile of AIM shares compared with other forms of stock market investment. PKF believes there is a strong case for the London Stock Exchange to commission research into this area. If it transpires that the risk factor of AIM companies does not significantly differ from Small Cap shares on the Official List, there would be significantly more pressure to revise the investment apportionment rules of institutional investors; this help could transform AIM into a major market worldwide. The number of AIM companies intending to transfer to the Official List has diminished significantly from a third in 2002 to a quarter in 2003 to just over one in ten in 2004, confirming AIM as the market of choice for the vast majority for the companies surveyed.