This blog gives you the latest topical news plus some informal comments on them from ShareSoc’s directors and other contributors. These are the personal comments of the authors and not necessarily the considered views of ShareSoc. The writers may hold shares in the companies mentioned. You can add your own comments on the blog posts, but note that ShareSoc reserves the right to remove or edit comments where they are inappropriate or defamatory.

AIM Introduces Covid-19 Emergency Measures

On Friday 20th March, AIM Regulation announced the measures which you can find here: https://www.londonstockexchange.com/companies-and-advisors/aim/advisers/inside-aim-newsletter/inside-aim-coronavirus.pdf

These are some quite significant relaxations of the AIM rules, to take account of compliance challenges companies may face. Most significant, we may see more suspensions of trading, to give boards time to make more accurate disclosures whilst they assess the impact of the pandemic on their businesses and take mitigating measures, AIUI.

Personally, I support this, because navigating this crisis will be very tricky for some companies and it would be better for boards to develop plans and make a proper impact assessment rather than rushing out a half-baked announcement which may confuse the market and turn out to be inaccurate, leading to a false market. Confusing announcements offer a field day to rampers and derampers seeking to manipulate the market, who can add their spin to the announcement via social media, to suit their own interests.

However, I don’t support the idea of suspending the requirement for NOMADs to make site visits when doing due diligence (DD) on a firm seeking admission to AIM. I feel it would be preferable to delay the admission until such time as the NOMAD can safely visit. Reducing physical DD increases the risk of fraudulent companies obtaining AIM quotations, IMO. There has been at least one occasion I can think of where, as an investor, visiting the site of a potential investee company proved very helpful in making a judgement of that company’s prospects.

Mark Bentley, Director, ShareSoc

 

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