London's junior market grows for first time since 2007 - Reuters UK

LONDON | Mon Oct 7, 2013 12:16am BST

LONDON (Reuters) - London's junior stock market grew for the first time in six years in the third quarter, according to research on Monday, as more companies joined than left.

Accountancy group UHY Hacker Young said 20 companies floated on the London Stock Exchange's (LSE.L) Alternative Investment Market (AIM) in the three months to September 30, while 16 delisted.

This was the first time more had joined than left since the third quarter of 2007.

"More companies are again looking at an AIM initial public offering as an opportunity for growth," said Laurence Sacker, Partner at UHY Hacker Young.

AIM's attractiveness to UK retail investors has been boosted by the government's decision earlier this year to allow AIM stocks to be included in individual savings accounts (ISAs) - popular tax-free products - for the first time.

The research showed 56 companies joined AIM in the 12 months to the end of September, raising a total of 881 million pounds - up 70 percent on the previous 12 months.

The overall value of companies listed on the AIM market was 67.7 billion pounds as of August, according to data from the LSE, down from a peak of 97.6 billion pounds in 2007.

Stronger equity markets have helped revive new listings in Europe after years of subdued activity due to the financial crisis, with London one of the busiest destinations.

Separate data from Ernst & Young over the weekend showed that, when the LSE's main market is also included, more than 3 billion pounds has been raised from London listings so far this year, double the amount raised in the whole of 2012.

Sacker said next year also looked busy for AIM, but the market is still a way off returning to previous levels - in the 12 months to September 30 2007, 8.8 billion pounds was raised by AIM IPOs.

"The deal pipeline is looking healthy. 2014 could turn out to be a real bounce-back year for AIM, although getting back to the level of new listings we saw during the boom years remains a pretty remote prospect," he said.

(Reporting by Kylie MacLellan; Editing by Ruth Pitchford)