Advisers cut fees to gain work from fundraisers

Tough competition among financial advisers in the City has been laid bare by data showing that the cost of entering London's junior stock market has dropped for the first time in seven years.

Fees charged by advisers for companies listing on the Alternative Investment Market (Aim) fell to 8.4 per cent of all money raised last year, according to research by the accountancy group UHY Hacker Young, down from 10.6 per cent in 2011.

The decline was blamed on price-cutting among advisers seeking the business of firms looking to float to keep their teams ticking over, after several years of low levels of IPO work.

A total of 43 companies launched new listings on Aim in 2012, raising a total of £676m – a 26 per cent jump from 2011 – while 100 firms departed, the lowest number of delistings since 2005.