Someone recently bought our

students are currently browsing our notes.

X

Aim Notes

LPC Law Notes > Equity Finance Notes

This is an extract of our Aim document, which we sell as part of our Equity Finance Notes collection written by the top tier of Cambridge And Oxilp And College Of Law students.

The following is a more accessble plain text extract of the PDF sample above, taken from our Equity Finance Notes. Due to the challenges of extracting text from PDFs, it will have odd formatting:

EQUITY FINANCE REVISION NOTES AIMAIM is an Exchange Regulated market (it is on a Recognised Investment Exchange), and is a prescribed market, but is not a regulated market (for the purposes of s.85 FSMA).

AIM vs Main Market

Advantages????Disadvantages

o

AIM No minimum market capitalization (although not really that important) Less onerous disclosure requirements (only need to comply with DTR 5) Assuming Admission Document is used, PRs will not apply (and more likely to fall within exemption to produce a prospectus) LRs will not apply; AIM Rules are more succinct and cost of compliance is significantly lower!
Slight timesaving (34 months as opposed to 6 months) Nomad in charge of process as opposed to getting approval from FCA - Nomad must be satisfied that the company is suitable for AIM, but Nomad has much more interest in guiding company through process! 1 QCA Guidelines in place of Corporate Governance Code - similar principles, although simpler, but more importantly no 'comply or explain' rule! Burden of constant justification goes away. No SH approval needed for 'class' transactions (called 'substantial transactions' in AIM Rule 12) - just need to disclose!
Tax benefits for investors of AIM companies (because they are 'unquoted' for the tax act, and more likely to be able to claim ER) Although do not need three years trading history, need lock

Main Market
? Bigger pool of investors to raise capital from; certain investors will only invest in listed companies. Retail investors as well.
? Liquidity of shares; share price will go up
? Easier for subsequent share issues as well as shareholders to exit
? Public profile

oRequirement for 25% of shares to be in public hands (LR 6.1.19R)

1 Initial stage based on very similar principles to a Main Market listing; still need to produce a significant document (admission document), still have oversight in the form of Nomad (as opposed to FCA), still need to conduct due diligence...However, it gets much easier in the later stages!!

1

Buy the full version of these notes or essay plans and more in our Equity Finance Notes.