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AIM growth market gets its mojo back by injecting 14.7bn into UK economy

The report found that over its 20 year history more than 3,580 companies listed on AIM; raising 39.5bn at admission and raising funds of up to  £51bn.

Of the 1,088 companies currently trading on AIM, 80 per cent are UK-based. Almost half of that percentage can be found outside London. In 2013 these companies employed a total of 430,000 individuals and contributed tax payments of 2.3bn.

In the years leading up to the recession (2005-2007), AIM companies significantly outperformed the wider business population, with turnover growth of 28 per cent. And in 2009, AIM companies contributed a total of 21bn to UK GDP, while supporting 570,000 jobs.

However, AIM companies experienced a two per cent decrease in turnover in 2010, while the wider business population experienced four per cent growth. In the period immediately following the recession, AIM companies have recovered faster, with a growth rate of seven per cent leading up to 2013, compared with the one per cent seen across the wider business population.

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“AIM has a great track record, but investment trends since 2002 show consistent net outflows from the UK small cap sector,” said Stephen Gifford, chief economist at Grant Thornton.

Changes to incentives for investors in AIM securities have diminished their effectiveness and “reduced investor confidence”, he suggested.

On the difference in numbers, Capita Asset Services business development director David Kilmartin said: AIM has sometimes been overlooked, and on occasion has struggled with volatility and liquidity. But the markets importance to young and growing firms cannot be underestimated.

New data from Capita Asset Services has unveiled a resurgence in AIM activity, which looks set to continue for the rest of this year.

Capita Asset Services found that there were “42 cash calls by listed AIM firms” in February 2015. The market’s 5.2bn of capital raised in 2014 also marked a four-year high and the number of IPOs, 79, has been the highest since 2007.

Philip Secrett, partner and head of public company advisory at Grant Thornton, said: “Despite the turbulence in international equity markets over the past years, AIM has maintained its position as the most successful growth market in the world and is now an established part of the funding ecosystem in the UK, supporting innovation, driving productivity and creating employment.”

Recent measures such as the removal of stamp duty on AIM shares and the inclusion of AIM shares in ISAs has “further supporting the development of the market and in turn, generating a material contribution to the UK economy,” Secrett said.



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