AIM: IPOs on London’s junior market stayed at rock bottom
The number of IPOs on AIM has continued at its record low numbers in 2024, sailing below the level of the financial crisis.
IPOs on London’s junior stock market totalled just 11 last year, the same number as in 2023 and below the 13 recorded during the 2008 financial crisis.
While the amount of money raised from AIM IPOs did increase, from £48m in 2023 to £119m in 2024, it is still significantly below historic levels.
Last year’s total was just two per cent of the £6.6bn raised at AIM’s IPO peak in 2006/7.
Data from last year revealed that secondary funding on the stock exchange has similarly fallen, dropping 33 per cent to £1.2bn in the first eight months of the year, compared to £6bn in 2021.
The number of companies either delisting, moving to the main London Stock Exchange, or being taken over has continually surpassed new floats on AIM, leading the number of stocks to slowly dwindle.
The total number of companies on AIM at the end of 2024 hit the lowest level in 23 years, with only 688 firms listed on the stock exchange. This is down from a peak of nearly 1,700 in 2007.
As investors continually pull billions from the junior market, firms are finding it harder to raise money compared to previous decades, while high fees have turned off bosses from listing on the market.
“There is excessive red tape and reporting obligations on AIM that smaller companies can simply avoid by remaining private,” said Colin Wright, chair of UHY Hacker Young.
“If AIM is to remain competitive with private equity and other junior markets, there needs to be a more open discussion on how we can reduce red tape for AIM companies. Most commentators agree that an active stock market for smaller companies is an essential part of a growth economy.”