Cost of listing on AIM soaring

The cost for new companies listing on AIM is soaring above the rate of inflation, largely due to the London Stock Exchange cracking down on rule breakers.

That is the conclusion of a joint survey carried out by the accountancy firm UHY Hacker Young and City law firm Trowers & Hamlins.

It found that the average cost of listing on the junior market had continued to increase during the past year to reach an average of 6.7% of all funds raised - up from 6.2% the previous year. For companies raising under £10 million, the average cost soared to 16.4%.

Rising fees among professional advisers are blamed for the increase. Laurence Sacker of UHY Hacker Young said: "The fall in initial public offering activity during the past year has not fed through into lower professional fees.

"Advisers are increasing the level of due diligence required for AIM listings and companies accept they are going to have to pay more for that."