As Lex observes, junior markets such as London’s Aim should be humming. But instead companies are disappearing “at a faster rate than they are from the main list”. Indeed Aim has lost more than 100 companies since the start of 2020, or a decline of about one-fifth (“Small-caps need special attention in planned overhaul of UK market”, Lex, FT Weekend, June 29).
The private investor experience of most of these exits from Aim would have, in many instances, offered a significant disincentive to want to support this market again. Alongside many other private holders I remain a shareholder in a company that delisted from Aim over four years ago now. In the company circular the board argued that access to capital would be easier away from the glare of the public markets, and undertook to provide regular updates to shareholders and to establish a matched bargain share trading facility.
Off Aim, further multiple fundraisings have been agonisingly slow, shareholder updates provided have been sporadic and partial (eg, no consolidated accounts have been prepared since the company left Aim). Annual general meetings are no longer held and no matched bargain (share) trading facility has been put in place.
It would be fanciful to conclude that the shareholder covenant implicit in the legally verified de-admission circular has been met. But the London Stock Exchange, responsible for the regulation of Aim, seems not in the slightest bit interested to follow this up.
Having invested, under Aim’s much heralded protections and protocols, private shareholders have in effect been abandoned. So, rather than in this instance the London Stock Exchange and Capital Markets Industry Task Force calling for less regulation, might retail investors be more willing to invest in Aim if they saw such regulation as we currently have, in relation to that market, actually working?
This might reinforce the trust City operators say underpins market functioning and offer a modicum of the “special attention” for which Lex argues.
Barry T Gamble
Banbury, Oxfordshire, UK
