London Stock Exchange AIM Listing
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Evaluation of a common stock offering process on AIM of the London Stock Exchange

Evaluation of a common stock offering process on AIM of the London Stock Exchange

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  • 1.
      • DICKSON CONSULTING
      • *********
    • Listing on London Stock Exchange
    • AIM Market
  • 2. Table Of Contents
    • Overview of AIM
    • Factors in Accessing Company Suitability
    • Pros and Cons of AIM
    • Examples of Benefits
    • Examples of Risks
    • Examples of Key Issues
    • Targeted Shareholders
    • Sample Timetable
    • Professional Advisors
    • Role of Nomad
    • Role of Broker
    • AIM vs. NASDAQ
  • 3. Overview of AIM
    • “ Small company” stock exchange portion of London Stock Exchange
    • Platform for higher risk investments
    • Since 1995 2,200 AIM companies have used AIM to go public
    • Total market value of $71.6 billion-pounds
    • Largest market cap company-$1.6 billion- pounds
    • Number of companies in market value range of $100 to $250 million pounds-131
    • Since 1995, 250 international companies
  • 4. Factors in Assessing Company Suitability
    • Management team
      • Capability
      • Integrity
    • Viable business model
      • Growth
      • Deliver value to shareholders
    • Valuation acceptable to all parties
    • The expectation is that at least $10 million (USD) will be raised, with market cap of $20 million minimum.
    • Corporate governance
  • 5. Pros and Cons of AIM
    • Pros of AIM
    • Less regulatory structure compared to U.S.
    • Fewer rules and costs
    • Access to capital
    • Market value of company more readily established
    • New investors
    • Market for stock
    • Public profile
    • Cons Of AIM
    • Key decision of officers and board members have increased visibility
    • Uncertainty of market conditions and other factors could impact share price
    • Communication with investors (roadshow)
  • 6. Examples of Benefits
    • Additional cash for more rapid growth
    • Exit strategy for existing shareholders
    • Publicly traded market
    • Increased visibility/communication
    • Entry or Reentry into European market with product
    • Employee morale resulting from benefits of share ownership
  • 7. Examples of Risks
    • Product not viewed as unique/competitive
    • Small company viewed as one product company
    • Product development not far enough along
    • Infrastructure not adequate for public company
    • Expense of being a public company
    • Time required
  • 8. Examples of Key Issues
    • Is this the most appropriate strategic alternative?
    • Existing shareholders sale at time of IPO?
    • Reaction to dilution?
    • Market price at time of initial offering?
    • Market price after initial offering?
    • Infrastructure to support public company?
    • Time required for CEO/CFO?
  • 9. Targeted Shareholders
    • Venture capital trusts listed on the LSE
    • Firms that specialize in investing in AIM market
    • High net worth individuals/retail investors
    • Larger financial institutions. Examples:
      • Merrill Lynch
      • Fidelity
      • Goldman Sachs
  • 10. Sample Timetable
    • LSE course on AIM market
    • Appoint advisors
    • Draft prospectus
    • IR strategy
    • PR presentation
    • Complete due diligence
    • Analyst presentations
    • Complete financials
    • Marketing
    • Book closes
    • Impact day
    • Placing completion*
    • Trading commences
    • Certificates issued
    • *Complete documents, pricing and allocation,
    • register prospectus, sign subscription
    • agreement, print final prospectus
    • 9/19 or 10/10
    • December 1
    • January 1
    • January 1
    • February 1
    • February 1
    • February 2-March 15
    • February 28
    • March 19- March 28
    • April 2
    • April 3
    • April 7
    • April 9
    • April 16
    • Front end of process=Selling
    • Backend of process=Legal
  • 11. Professional Advisors
    • Accounting firm
    • Law firm
    • Nominated Advisor (“Nomad”)
    • Broker (may be same firm as Nomad)
    • Public/investor relations
  • 12. Role of Nominated Advisor (“Nomad”)
    • Access whether company is appropriate for market
    • Explain the AIM rules to company’s board and ensure that the directors are aware of their responsibilities and obligations
    • Project management of the process
    • Help pull together admission documents
    • Provide ongoing advice and guidance on the AIM rules once company has been admitted
  • 13. Role of Broker
    • Gauging interest and advising on pricing
    • Bringing buyers and sellers of company’s shares together (marketing and book building)
    • Preparing and accompanying company on the roadshow
    • Trading in the secondary market
    • Provide research
  • 14. AIM vs. NASDAQ
    • Favor NASDAQ
    • U.S. based market
    • Communications easier with U.S. shareholders
    • Average capitalization
    • $1.2 billion
    • Favor AIM
    • U.S. regulatory requirements (Sarbanes-Oxley)
    • No minimum stock price (NASDAQ delisting if below $1 per share)
    • Legal scrutiny over communications
    • Average capitalization $70 million
  • 15. Services of Dickson Consulting
    • Board of directors/advisory board representation
      • Designated financial expert
    • Senior executive services
    • Strategic planning facilitation
    • Financing assistance
    • Business valuations
    • Exit strategy and M&A assistance
    • Investor relations strategies
  • 16. Disclaimers
    • This presentation is not intended to provide investment advice or any other advice on any company mentioned.
    • The information in this presentation is believed to be correct but no assurances are provided that the information is correct.
    • Events may have occurred that are significant that are not mentioned in this presentation.