Aiming for the top

Supporting businesses in their successful flotation

Despite ongoing shockwaves from the pandemic, the AIM IPO market has been incredibly buoyant. In the summer, July saw the biggest number of newcomers in a month since December 2014 with 16 IPOs. Since the launch of the market in 1995, AIM has emerged as one of the most successful growth markets in the world. Its success is built on a simplified regulatory environment which has been specifically designed for the needs of small and emerging companies. What has become clear looking at the businesses floating is that you don’t need to be a ‘unicorn’ – since 2020, the average market capitalisation of an AIM company at IPO was £102m. IPOs can suit businesses of varying sizes, with 70% of 2020-21 IPOs having a market capitalisation of <£100m on admission and the majority sub £20m. By contrast, just 10% of IPOs in this period featured a market capitalisation of >£200m. Even with the recent interest rate rises it is still a low interest rate environment with capital available to fund IPOs. Additionally, the take-over strength of the dollar remains strong and, as seen with the level of activity within our corporate finance team advising on transactions in the consumer sector, there is continuing retail interest supported by a stronger Covid recovery than expected.

Advising on Tungsten West’s flotation

Along with our colleagues at PKF Littlejohn, who specialise in advising companies looking to list, we recently provided support on Tungsten West plc’s successful flotation on the London Stock Exchange by acting as reporting accountants for the company’s IPO. Tungsten West raised approximately £39 million from investors on admission to the AIM, giving it a market capitalisation of £106.2 million on its first day of trading. This initial investment will help to fund its plans to restart mining at Hemerdon, near Plymouth. The company was incorporated in 2019 as a special purpose vehicle to purchase the Hemerdon Project out of receivership. It is focused on rebuilding and restarting the mine to supply two critically important strategic minerals – tungsten and tin – to the Western hemisphere. Hemerdon Mine is the world’s third largest tungsten resource.

“We were grateful for the services provided by PKF Francis Clark during the preparation for admission
to AIM. We appreciated the team’s dedication and professionalism over what was an intense but ultimately extremely successful process. We look forward to working with PKF Francis Clark over the next phase of Tungsten West’s development, as we move towards restarting Hemerdon, a significant project both for the UK and globally due to its substantial tungsten resource.”
Nigel Widdowson
CFO of Tungsten West

Within the South West, PKF Francis Clark audits many of the largest businesses in the region. Of the top 150 businesses based in Devon and Cornwall, we audit 27%, the same market share as the Big 4 combined and the largest by some margin. We also audit a number of AIM-listed entities.

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