FLOTATIONS

Money makes the world go around

Big Bang 1986

In October 1986, the City of London was deregulated overnight so that the closed shop of stockbrokers and stockjobbers no longer had a monopoly of dealing in stocks.

Consequently, with some apprehension, a number of banks  decided to enter the securities market in part as a defensive move to prevent competitors with a distribution capability from eroding its corporate finance business. This kind of  move enabled merchant banks such as Kleinwort Benson to distribute the new issues it originated rather than relying on a third party.

Although, like many other banks at the time, Kleinwort Benson contemplated buying a jobbing firm in order to get into the market, in the end they were saved from having to do so by the defection of a number of senior market-makers from Wedd Durlacher Mordaunt as it was acquired by Barclays Bank.  There was a kind of deregulation fever with several panic acquisitions, which situation is now more stable.

Floating on a stock market: your options

Introduction

A stock market flotation involves selling a percentage of your business in the form of shares on one of the stock markets. There are three stock markets in the UK. At the top is the main market of the London Stock Exchange, which is generally populated by large companies, and then there is the Alternative Investment Market (AIM) and Ofex, both of which are specifically designed for smaller companies.

Floating on the stock exchange can be time-consuming and costly so is not suitable for all businesses. You might consider it if you want to raise capital, or have private investors or an owner-manager that wants to cash in on their investment. It can also help you increase your business' profile and motivate your employees by issuing them with shares.

This guide explains the advantages and disadvantages of floating on a stock exchange. It sets out the features of the different UK markets, how to appoint advisers and how to prepare for a float.

Subjects covered in the Business Link guide

• Introduction

• Is your business suitable for flotation?

• What is a flotation and why consider it?

• Advantages and disadvantages of flotation

• Choose the right market

• Appoint your advisers

• Prepare for a flotation

• Price your business' flotation

• The flotation process

• Here's how we prepared our business for flotation

Actions

• Find out about the advantages of flotation on the London Stock Exchange website

• Read about the Ofex market on the Ofex website

• Find out about AIM and the Main Market on the London Stock Exchange website

• Use our interactive tool to find the right finance for your business needs

• Buy an online course on Finance and Budgeting at the learndirect business website

• View local and national events linked to this topic

MONEY FINDER

This website is copyright © 1991- 2013 Electrick Publications. All rights reserved. The bird logo and names Solar Navigator and Blueplanet Ecostar are trademarks ™.  The Blueplanet vehicle configuration is registered ®.  All other trademarks hereby acknowledged and please note that this project should not be confused with the Australian: 'World Solar Challenge'™which is a superb road vehicle endurance race from Darwin to Adelaide.  Max Energy Limited is an educational charity working hard to promote world peace.

 AUTOMOTIVE  |  BLUEPLANET BE3  |  ELECTRIC CARS  |  ELECTRIC CYCLES  |  SOLAR CARS  |  SOLARNAVIGATOR