According to research from the accountancy group UHY Hacker Young, the Alternative Investment Market (AIM) had its worst year for new issues since 2009.
The research found there were just 39 initial public offerings made on AIM last year, equating to approximately £600m raised. This total is drastic 54% drop on the 85 IPOs made on AIM in 2014. Other findings included a worrying drop in the number of companies listed on the London stock market, which constituted the biggest net decrease in listings since 2012.
UHY Hacker Young cited a number of issues that could’ve been to blame; a decrease in new issues, the departure of Chinese businesses, and the loss of oil and gas companies.
“In the last year” reflected Laurence Sacker, partner at UHY Hacker Young, “AIM’s strengths have proved to be its weakness. The success of AIM has long been built on its appeal to mining and oil and gas companies and its attraction for man Chinese companies seeking to raise capital and gain a market for their shares. But a collapse in oil, copper and iron prices and the slowdown in the Chinese economy have made 2015 a tough year for AIM”.
Commenting on the situation, a spokesperson for the London Stock Exchange said: “For a growth market like AIM, the ability of existing companies to come to the market for fresh funds is almost more important than the number of IPOs”.