Increasing numbers of Israeli firms have been looking to the London Stock Exchange’s Alternative Investment Market, known as AIM, to raise capital.
AIM was established by the London Stock Exchange to permit small growth companies to more easily raise capital and to provide a marketplace for their shares. The vast majority of the companies listed on AIM are U.K.-based.
The four AIM-listed Israeli firms (as of July 31, 1996) provide the largest foreign representation. In December 1995, Dmatek Ltd. was the first Israeli company to list on AIM. It was followed in mid-1996 by BATM, S.E.A. Multimedia and Selector Ltd. Several more Israeli companies are in the process of preparing offerings.
Admission requirements to AIM are relatively easy to meet. There is no minimum size nor amount of time in business, and there is no prerequisite percentage of stock to be held by the public.
The rules and conditions that do exist mostly relate to trading restrictions on directors and employees, freedom of transferability of shares, and the need for accounting to conform to generally accepted principles in the U.K. or U.S. or to other international standards.
AIM’s lenient requirements make it easier for some Israeli firms to list in London than in the United States or Tel Aviv. AIM mandate that companies appoint and retain financial advisers and brokers from an authorized register of respected U.K. firms serves, however, to screen out unworthy prospects. The advisers and brokers do their best to select only promising companies to protect and enhance their own standing.
Non-U.K. investors interested in purchasing Israeli stocks traded on AIM can do so through their local broker which likely has a relationship with a member firm on the London Stock Exchange. Price quotes on AIM stocks are available on Bloomberg and Reuters. Shares are quoted daily in the Financial Times.
Standard & Poor's Review of Israeli Public Companies and Financial Institutions