Review of AIM rules

The London Stock Exchange has published a discussion paper that identifies the following key areas of its review of the AIM Rules for Companies and the AIM Rules for Nominated Advisers:

Entry criteria

As AIM has matured and the market capitalisation of AIM companies and the average amount of capital they raise have increased over time, the London Stock Exchange (LSE) is considering whether to introduce a minimum free float requirement and a minimum capital raising threshold.

Based on the size of fundraise by new AIM applicants between 2014 and 2016, the LSE asks for feedback on possible minimum fundraising levels.

Early notification process

Currently, nomads are only required to approach the LSE at an early stage of an application if there are unusual features or potential issues that may be of concern to the LSE.

The LSE proposes to require early confidential discussions for all proposed admissions in order to reduce the risks of a delay, postponement or withdrawal of a proposed admission and to avoid issues towards the end of the application process.

Assessment of appropriateness

The LSE is proposing to include in the AIM Rules for Nominated Advisers a non-exhaustive list as guidance to nomads of the factors they should take into account when assessing the appropriateness of a company prior to its admission to AIM.

The LSE emphasises that each of these factors, in their own right, can be of such importance as to render a company not appropriate for AIM.

Corporate governance

The LSE is examining whether the current corporate governance disclosure requirement in AIM Rule 26 remains sufficient or whether it should make it mandatory for AIM Companies to annually comply and explain against existing codes of governance, such as the Quoted Companies Alliance Corporate Governance Code for Small and Mid-Size Quoted Companies and the UK Corporate Governance Code.

Source: The full article from Investment Week can be found here.