Why go private?

The equity markets, and AIM in particular, are being crowded out by bigger voices, shouting louder for more money. So no matter how good the news is that you are announcing, market participants' attentions are directed elsewhere. This points to a near impossible task for management of AIM companies to raise funding.

AIM companies finding it difficult to unlock value could find life easier by delisting. Many companies find themselves in a quoted environment where the original rationale for being quoted is no longer relevant. You may have come to the market buoyed by the availability  of private equity source capital.

This is not to say that there is anything intrinsically wrong with your company, but if your company doesn't need the market then the market doesn't need your company.

You are probably delivering as expected results, or even results that exceed expectations.

You are probably going from strength to strength.

You are probably putting in all the effort you can to make sure tht you are better than your peers.

But if you are not being followed by the market, then your stock will have zero momentum.

Costs to AIM are high:

• A client proposing to list in the next few weeks has allotted £300,000 for their Nomad, broker, lawyer and reporting accountants.
• This does not include the adequate working capital requirement that a company is required to have to fund the first 12 months of trading post-listing.
• Another client had set nearly £2.5m aside in Transaction, IPO and working capital costs on a listing to raise £15m.

Costs to remain on AIM are high:

• An AIM listed client has allocated over £286,000 just to cover nomad, broker and audit fees.

By de-listing, the company saves on these annual listing costs albeit by incurring a one-off cost to de-list.