Recently, there’s been a noticeable trend of companies planning to exit AIM (Alternative Investment Market) within the last month.
This trend indicates a growing impatience among some companies with the challenges of the junior market. However, this doesn’t necessarily spell trouble for AIM’s future.
Companies like Molecular Energies (an oil and gas firm), Byotrol (specializing in antimicrobial technology), C4X Discovery (in drug discovery), Redx Pharma, and cloud telephony services provider LoopUp, are all in the process of seeking approval from their shareholders to leave AIM.
A common reason cited by these companies is the difficulty in securing sufficient liquidity and the challenges in fundraising on AIM, despite successful large-scale funding in the past.
Molecular Energies, in particular, has decided against spinning off its green technology investment venture, Green House Capital, as a separate entity on AIM. Infrastructure India is also planning to leave AIM as a part of its strategy to wind down its operations.
In 2008, a total of 54 companies opted to withdraw their listings from AIM, a number which escalated to 111 in 2009, marking the highest departure rate. This figure represented two-fifths of all the companies that left AIM that year.
The trend slightly decreased the following year, with 47 companies departing, accounting for nearly 30% of the exits, a proportion significantly higher than any other reason for leaving.
The FTSE AIM All Share index hit its lowest point in March 2009, but began a long-term upward trend starting in the summer of that year. Despite this positive shift, the trend of companies leaving AIM persisted.
In 2023, the number of companies leaving AIM was 17, a notably smaller figure compared to the 30 companies that were acquired that year. The most recent low point for the FTSE AIM All Share index occurred last October. While the trend for the index is still not entirely positive, there are indications that it is beginning to stabilize.
Total number of AIM Companies: 742
The total market cap for all AIM is £76.1bn
