Transcript John Edwards - London Stock Exchange

Opportunities for Russian Companies
On the London Stock Exchange & AIM
Main Reasons for Listing on the LSE
Liquidity
Increasing and
maintaining
liquidity
Profile
Capital
Raising it efficiently
& effectively when
required
Growth
Maximising
marketing/PR
opportunities
Independent Market
Expertise
Recommendations on how to maximise
the value of joining a London market
The Exchange: supports capital raising and generates liquidity  supporting customers
in maximising shareholder value
March 2007
2
Last 15 Months – Post IPO
51%
23%
27/02/07
15%
11%
11%
3
13/02/07
TME
-22%
TMK
SITRONICS
SISTEMA
HALS
ROSNEFT
13/02/07
SEVERSTAL
-17%
POLYMETAL
CHERKIZOVO
March 2007
-7%
INTEGRA
-10%
COMSTAR
-17%
CHELYABINSK
7%
Assets Under Management in Major
Western Financial Centres
12.7
10.6
5.5
Other Assets ($tn)
Equity Assets ($tn)
7.7
5.2
2.5
7.2
3.7
2.4
3.0
NY
2.8
1.2
2.2
2.7
1.3
London
3.2
Boston
Paris
1.6
1.0
Frankfurt San Fran.
London is a global leader in asset management
March 2007
Source: Big Dough, Hemscott (January 2007)
4
1.6
1.5
1.4
0.5
1.1
0.7
0.7
1.1
LA
Chicago
Munich
0.3
DR Trading on IOB
1,000
Number of Trades
900
Trade Value (USD)
300,000
800
Trade Value (USD)
250,000
Thousands
350,000
700
600
200,000
500
150,000
Trades
Millions
DR Trading
400
300
100,000
200
50,000
100
0
0
2001
2002
2003
2004
2005
2006
In 2005, IOB total trading turnover was $131bn and in 2006 that number increased to $290bn,
a 121% increase.
Source: London Stock Exchange - January 2007
March 2007
5
To summarise… Why choose AIM?
World’s most successful growth market
Balanced approach to regulation
Professional investor base
Cost effective
International profile
March 2007
6
Key AIM Statistics
• AIM: 1,635
• UK: 1,331
• International: 304
• AIM Market Capitalisation: £94.4 bn
• AIM IPOs in 2006: 278
• UK: 201
• International: 77
• Capital raised since 1995*: £40.1bn
• Capital raised in 2006*: £15.7bn
• UK: £10.3bn
• International: £5.4bn
* New listings and further capital raises
Source: London Stock Exchange trade statistics – March 2007
March 2007
7
AIM Money Raised (£bn)
18
Further Money Raised
New Money Raised
16
14
12
10
8
6
4
2
0
1995
1996
1997
1998
1999
2000
2001
2002
2003
2004
2005
2006
AIM is more than an IPO market, it provides companies with high quality long
term institutional liquidity and the ability to raise further capital to fund
future growth
March 2007
Source: London Stock Exchange, March 2007
8
Size Distribution for Companies on AIM
(# Companies)
372
227
219
196
197
174
135
0-2
2-5
5-10
10-25
25-50
50-100
100-250
26
7
7
250-500
5001,000
> 1,000
market capitalisation (£m)
The average AIM company market cap is £60 million. The average AIM
international market cap is £111.
March 2007
9
Top 10 AIM Sectors by Market Cap
15.9%
10.7%
10.2%
10.0%
4.5%
4.5%
4.4%
Equity
Investment
Instruments
Media
Software &
Computer
Services
AIM is a diverse market spanning 39 sectors
Source: London Stock Exchange trade statistics – March 2007
March 2007
10
3.6%
Pharmaceuticals
&
Biotechnology
4.6%
Travel & Leisure
Support
Services
General
Financial
Oil & Gas
Producers
Real Estate
Mining
6.0%
Admission
Requirements
•
No minimum size
•
No trading record required
•
No minimum number of shares in public hands
•
No prior shareholder approval required for transactions*
•
Admission documents pre-vetted by nominated adviser
•
Nominated adviser required at all times
AIM’s success is built on a balanced regulatory environment, designed to make
the floatation process as smooth as possible
March 2007
* In most cases
11
Liquidity & Institutional Investors
on AIM
Rank
Institutional Investors
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
CDS & Co
Fidelity
Artemis Investment Management
New Star Asset Management
AMVESCAP
Merrill Lynch
Cede & Co
AXA
Gartmore
Schroders
Goldman Sachs
UBS
CSFB
Lansdowne Partners
F & C Asset Management
No of Investments
10
160
130
50
84
67
5
118
90
57
72
59
54
27
120
Value of Investments (€m)
4,809.84
1,544.49
1,009.36
976.75
970.99
887.46
886.55
839.18
810.71
747.79
666.82
564.95
564.55
545.58
541.70
World’s largest institutional investors are all active participants on AIM.
Source : Growth Company Investor
March 2007
12
Case Study 1 - Imperial Energy
• Oil exploration and
Imperial Energy Share Price Performance
production
1500
1400
• Listed on 05 April 2004
March 2007
1100
1000
900
800
700
13
22/03/2007
08/03/2007
22/02/2007
08/02/2007
25/01/2007
11/01/2007
28/12/2006
14/12/2006
600
30/11/2006
• Share price has risen by
130% over the past 6
months
1200
16/11/2006
• Market cap today £788mln
Share Price (GBX)
• Market cap at admission
- £2.5mln
1300
Case Study 2 - Aricom Plc
Aricom Plc Share Price Performance
• Titanium
March 2007
40
30
20
10
14
19/03/2007
19/02/2007
19/01/2007
19/12/2006
19/11/2006
19/10/2006
19/09/2006
19/08/2006
19/07/2006
19/06/2006
19/05/2006
19/04/2006
19/03/2006
0
19/02/2006
• Share price has risen
by 294% since 19th
December 2005
50
19/01/2006
• Market cap today £304.48mln
60
19/12/2005
• Market cap at
admission - £14mln
70
Share Price (GBX)
• Listed on 31st
December 2003
80
Cost structure for AIM listing
Legal reports and negotiations
Law Firm
(NOMAD’s)
Law Firm
(Corporate)
£150k-£300k
of which Nomad’s
Lawyers get 25-40%
Prospectus
Preparation
£150-200k
plus 1% option
NOMAD
Reporting
Accountants
Company
Underwriting &
analytical coverage
£100k£150k
3-5% of the deal,
plus 1% option
Broker
£10k
Listing and trading Services
Stock Exchange: AIM
LHC
CREST Co
Registrar
Short - form
report
Technology
Experts
£25k-£50k
Public Relations and
Investor Relations
PR firms
Independent
Researchers
The total cost of raising £50m ranges between £2.5-5m (5%-10% cost range)
excluding value of options
March 2007
Source: Oxford Said Business School MBA Project, August 2006 as amended by London Stock Exchange
15
Contact Details
Jon Edwards
Senior Manager, CIS & CEE
+44 (0) 20 7797 1599
[email protected]
Zarina Korolova
Manager, CIS & CEE
+44 (0) 20 7797 4472
[email protected]
www.londonstockexchange.com/aim
March 2007
16