Raising Capital: Alternatives To Flotation

Whether a business is planning to grow through acquisition opportunities or by developing organically, expansion will require capital to support and sustain the growth strategy. For many companies the buoyancy of the UK market means that flotation is being considered as the next step in development - a means of accessing capital investment. For those not ready to face the strict regulatory requirements for entry on the main market, listing on London's junior market (AIM) provides a viable alternative. In the first seven months of 2006 alone, £17.8 billion has been raised by companies floating on AIM.

However, there may be more appropriate means of raising capital than an Initial Public Offering (IPO). The flotation process may be too expensive, problematic issues might be raised through due diligence, the management team may not yet be ready for life in a quoted company, the company might still have greater potential as a private entity, or the markets themselves might be