AIM advisors look to build out

The international success of the London Alternative Investment Market (AIM) is feeding demand for equity capital markets professionals who can help bring overseas companies to market.

"There's huge interest from overseas companies who want to list on AIM," says Garry Levin, a managing director at Altium Capital, a corporate finance boutique with offices in Milan, Madrid, Paris and New York, among other places. "There's definitely the potential to hire people in order to bring in the additional business."

AIM is the London Stock Exchange's answer to Nasdaq in the US, or Germany's Neuer Markt. Of late it's proved noticeably alluring to overseas companies seeking a UK listing. In 2005, for example, 94 non-UK companies listed on AIM, bringing the total to more than 250.

Nomads hiring on transaction side

That allure has created opportunities for banks and boutiques to help arrange listings. In order to bring a company to AIM, a bank must be listed as a nominated advisor, or 'nomad.' The US bank Jefferies achieved the designation last year, and Bear Stearns is reportedly one of several seeking nomad status in future.

Bruce Huber, head of Jefferies European technology investment banking team, says the bank has made several hires to strengthen its European resources for advising high-growth companies. For example, Alexander Hofmann, former head of European technology mergers and acquisitions at Credit Suisse, joined earlier this month as a managing director.

Huber says it helps to have country-specific originators to bring in the new business. But one equity capital markets recruiter says AIM-related demand is more on the execution side.

"The skill set required is not in the origination of the deal," says the recruiter. "A lot of companies that want to list on AIM will contact the better-known advisors directly. If anything is required, it's the transaction expertise to actually bring the company to market."

David Carrier, a director at search firm Kinsey Allen, agrees that most banks are now short of transactional expertise to work on both AIM and LSE listings. "Quite a few places are trying to rebuild their execution capability," he says. "A lot of teams were decimated in the downturn of 2001 and 2002, and banks are still trying to build them up again."

Aggressive LSE marketing

Many of the newcomers are US companies looking to escape the shackles of Sarbanes-Oxley audit regulation. But there are also plenty of new entrants from continental Europe and Asia.

Italian telecoms company Elitel listed in February 2006, while the boutique corporate finance firm London Asian Capital is reportedly planning to bring eight Chinese companies with a combined value of 150m to AIM this year.

"AIM offers access to financial markets for international growth companies who, for regulatory or other reasons, can't get access at home," says London Stock Exchange spokesperson Richard Webster-Smith. "We've been marketing this very aggressively overseas."