Energy Firms Fuel Interest in the AIM

The rush of energy firms listing on the Alternative Investment Market (AIM) shows no sign of abating, according to a new report.

The year to the end of July saw 75 Initial Public Offerings (IPOs) in the mining, oil and gas sector on AIM, with a total value of more than pounds 2.2bn.

This is three times the levels seen in the previous 12 months, when there were 23 IPOs in the sector with a combined value of pounds 1.06bn.

There were only eight in the 12 months before that, worth pounds 390m in total.

North biofuels companies D1 Oils and the Biofuels Corporation are both listed on AIM and experts at law firm Eversheds believe investor appetite for such listings remains undiminished.Alan Fletcher, corporate partner at Eversheds’ Newcastle office, said: “Oil prices are at record levels whilst demand for energy continues to see strong growth, particularly in China, Eastern Europe and India.

“On top of which, a number of mining companies are doing excellent business with investors keen to participate.

“The London market is quickly establishing itself as the flotation market of choice for international companies ( with energy firms at the top of the list.”

Mr Fletcher also believes the introduction of stricter regulatory rules in the US has put off several companies from listing on American exchanges and drawn them towards the UK.

He said: “We’ve already seen a number of sizeable foreign flotations in the London market in this sector.

“With energy demand showing no signs of abating and a return of investor confidence in equity markets, the oil, gas and mining sector is likely to remain popular over the coming months.”