Arbuthnot Regulatory News (ARBB)

9 Jun 2006 08:00

Arbuthnot Banking Group PLC09 June 2006 AIM Investor Survey 2006: Pushing out the limits The second AIM Investor Survey, sponsored by Arbuthnot Securities, is releasedtoday. This survey of investors' attitudes and perceptions towards theAlternative Investment Market (AIM) is based on the views of over 40 majorinstitutional managers, venture capital trust funds, hedge funds and privatebanks and was undertaken by Financial Village on behalf of Arbuthnot Securities. The key themes to emerge in the findings include: •The sustained confidence of institutional investors - 62% of respondents said they would be investing more on AIM this year, with these investors now accounting for an estimated 50% of ownership and 80% of trading. •An increasing focus on liquidity - investors are looking for a minimum market capitalisation of at least £20m and a free-float of at least 33%, substantially higher than the benchmarks from last year's survey. •The ever-rising proportion of international listings - 85% of investors now own shares in overseas companies listed on AIM and international companies now represent 17% of total listings. •Control of admission policy - seen as the area in need of greatest improvement while the quality of companies that are being brought to the market is of greatest concern. •In this context a growing emphasis on the importance of the role of the Nomad and access to information is not surprising - 43% of respondents rank post-IPO research as being poor and 68% want to see at least three analysts covering stocks in the aftermarket. Mark Brown, Chief Executive of Arbuthnot Securities, commented: "The past 12 months has seen AIM consolidate its position as the world's leadingmarket for growth companies and the sustained overall confidence in the marketon the part of institutional investors is reassuring for all concerned. However,such rapid growth has inevitably brought with it concerns over admission policyand the quality of some companies coming to the market; in this context theLSE's forthcoming guidance on best practice for the 80 or so Nomads is to bewelcomed." The AIM Investor Survey 2006:Pushing out the limits, is available at £399 plusVAT. Contact Pauline Tribe at Arbuthnot Securities - 020 7012 2075. Contacts ArbuthnotMark Brown 020 7012 2150 MaitlandRichard Farnsworth 020 7379 5151 Financial VillageTim Draper 020 7520 9394 The Second AIM Investor Survey The key findings of this year's survey are: Investor Confidence €62% of respondents said that they would be investing more on AIM this year €35% were pleased with post-IPO price performance while 38% were disappointed •As in last year's survey, support services and technology were nominated as the sectors that investors would currently favour the most, while retail and real estate were the sectors to avoid (last year it was resources) Liquidity •Two-thirds expect to see a new-issue price discount of more than 10% to comparable stocks in the sector •A similar proportion were happy with a minimum market capitalisation of £20m, funding of £5m and free float of 33%. All these benchmarks were higher than last year when the corresponding numbers were £10m, £3m and 25%. This may reflect increasing liquidity concerns €65% felt that existing shareholders selling at IPO was a negative factor and a similar percentage voted for lock-ins of more than 12 months Management Quality •The quality of management was, as last year, seen as the key attraction for investors at IPO •A career in industry was seen as by far the most acceptable background for non-executive directors, while consultancy was the least favourite •Meeting forecasts was seen as the most important factor for management to deliver on Pre and Post IPO Research €90% of respondents read pre-IPO research and 74% read it before meeting management, the main benefit being background information €48% ranked post-IPO research as being only adequate and 43% as poor, a significant deterioration on last year's result (54% and 24%, respectively) €68% would like to see three analysts covering stocks in the aftermarket and 70% felt that research sponsored by the company added some value International Listings €85% of investors owned shares in overseas companies listed on AIM (up from two-thirds last year) and two-thirds highlighted access to information as their main concern with these holdings •Western Europe and China were the most favoured regions and Israel and Australia the least Admission Policy •Control of admission policy is seen as the area in need of greatest improvement, while the quality of companies that are being brought to the market is of greatest concern ENDS NOTES TO EDITORS Arbuthnot Securities Limited Arbuthnot Securities is a full-service, integrated investment bank providing acomplete range of institutional stockbroking and corporate advisory services,focused on growth companies (mid- and small-cap) listed in the UK. ArbuthnotSecurities takes a long-term, relationship-driven approach to best serve bothits institutional and corporate clients through a high-quality service dedicatedto adding value. Arbuthnot Securities has approximately 70 staff who service itsUK and international clients from offices in the City of London and Edinburgh. Arbuthnot Securities Limited is the investment banking division of ArbuthnotBanking Group PLC whose shares are quoted on the Alternative Investment Marketof the London Stock Exchange. Financial Village Limited Financial Village is a financial communications consultancy specialising inmedia and investor relations services to growth companies. Financial Village hascompiled the AIM Investor Survey for Arbuthnot Securities for the last twoyears. This information is provided by RNS The company news service from the London Stock Exchange