Junior market gets ready to go

TRADING starts on 19 June on AIM, the stock exchange's new junior market that replaces the Unlisted Securities Market, writes Clifford German.

The requirements for a listing have been tightened to ensure that companies traded on the market retain a financial adviser and a broker after they have floated. But companies looking for listing on AIM will not have to meet the requirements of a full listing, which specify a minimum share capital, a five-year trading history and a minimum 25 per cent of the shares for sale.

KPMG, the accountancy firm, thinks the new market will appeal to young businesses, recent management buy-outs and family businesses. It forecasts that as many as 100 companies will be traded within 12 months provided the market attracts companies whose shares are currently traded in matched bargains only.

The new market could provide more companies with an opportunity to establish a market in their shares, to raise capital, and to use their shares to mount future takeover bids. It will also provide "professional and experienced investors with new and inviting opportunities", according to Michael Lawrence, chief executive of the Stock Exchange. But not, by implication, widows and orphans.