Trends in Delistings: Most delistings on AIM are at the company’s request

Trends in Delistings: Most delistings on AIM are at the company’s request

This News Analysis considers 171 delisted companies from AIM of the London Stock Exchange (LSE) and highlights the trends found in the periods 2016/7 and 2017/8.

Corporate analysis: Market Tracker reviewed 71 delistings from AIM between 1 February 2017 and 31 January 2018 (2017/8 Period). This analysis examines the reasons cited by these companies for delisting, making comparisons with the 100 companies which delisted from AIM in the period between 1 February 2016 and 31 January 2017 (2016/7 Period). The statistics used in this analysis are based on the AIM statistics from the LSE website.

2017/8 Period Trends

In the 2017/8 Period, 71 companies cancelled their shares on AIM. This confirms a decrease of 29% from the 2016/7 Period, compared to the 100 delistings in the 2016/7 Period. The higher number of delistings in the 2016/7 Period may be explained by the uncertainty surrounding the political and economic climate created by the EU referendum in June 2016. This uncertainty may have lessened in the 2017/8 period, which is indicated by a fall in the number of delistings. Of the 71 companies reviewed during the 2017/8 Period, reasons for delisting were:

  • At the company’s request (22/71 companies—31%)
  • As a result of an Acquisition (Merger/MBO/Private/PLC Acquisition/ Takeover/Scheme) (19/71 companies—27%)
  • Pursuant to AIM Rule 41 where the company’s shares have been suspended for more than six months (16/71 companies—22%)
  • Pursuant to AIM Rule 1 where the company has failed to appoint a nominated adviser (14/71 companies—20%)

Costs were a factor in over two thirds of companies’ requests

‘The considerable cost, management time and the legal and regulatory burden associated with maintaining the Company’s admission to trading on AIM which, in the directors’ opinion, are disproportionate to the benefits to the Company’ Turbo Power Systems Inc.—19 April 2017

Of the 22

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