Pre-IPO PE funding on increase

The move of non-UK companies to list on the London Stock Exchange (LSE), and in particular the less stringent regulatory requirements of the LSE’s Alternative Investment Market (AIM), has been the subject of many headlines of late. AngelBourse, the company that typically raises early stage equity finance for high growth companies, reports that its members have also benefited from this move by overseas companies. AngelBourse says that approximately 14% of the companies that approached it to raise capital from among its membership of high net worth individuals in the first half of 2005 had overseas origins, compared to just 8% the previous year. In real terms this is two companies that have already raised money and there are another six preparing to do so.

John Blowers, managing director of AngelBourse, said: “Overseas companies are being attracted to London by AIM’s success to raise equity capital. They then recognise that they are not quite ready for AIM and decide to use our AngelBourse facility to fund their growth and to prepare themselves for an AIM listing.”

AIM figures show that in January to May 2005 of the 216 companies admitted to the exchange, 16% were registered overseas, compared to 9.8% of the 277 admitted in 2003.