Floating Your Company

3. Choosing the Market

3.1 For companies raising up to £10m PLUS (previously known as OFEX) is a possible choice. Floating this way allows shares to be traded 'off-exchange'.

• The requirements for a company to trade on PLUS are less stringent than for AIM (see 3.2) or the Main Market (see 3.3).
• The costs of flotation, and the ongoing costs, are lower for PLUS than for AIM or the Main Market.
• The pool of investors is relatively limited.Most investors in PLUS shares are private individuals. But more institutions are beginning to invest.
• Share prices, company announcements and other information can be found on the PLUS website.

3.2 Larger companies may prefer to float on AIM (or the Stock Exchange Main Market).

• The company will get a higher profile within the investment community.
• There are more investors who are willing to buy AIM-traded shares.Venture capital trusts can invest in AIM companies.
• If the company has been in existence for two years or less, existing shareholders must agree not to sell their shares for at least one year after flotation.
• There must be no restrictions on the free transferability of shares.
• There is no minimum percentage of shares that you must make available. However, having fewer shares available could make the share price volatile.

3.3 The full Stock Exchange Main Market is generally only suitable for the largest companies with a three-year track record.

• The Main Market is the most high-profile market. Almost all investors will be prepared to invest in shares quoted on the Main Market (if they appear to be a good investment). But many larger investors will only invest in companies whose market capitalisation (the total market value of all the company's shares) is substantial, say several hundred million pounds.
• Costs are considerably higher than floating on PLUS or AIM.