Analysis

Apr
2016

Assisting Nominated Advisers to achieve their AIM

Since its inception in 1995, AIM a sub-market of the London Stock Exchange, has established itself as one of the world’s leading growth markets.  To date, AIM has helped over 3000 companies raise capital in excess of £67 billion.

There is a vast network of advisers and intermediaries that contribute to this success story. However, the Nominated Adviser (“Nomad”) is undeniably one of the pivotal role players.

The Nomad’s role is broadly two-fold.

On the one hand it has wide ranging responsibilities and obligations towards those companies seeking admission to AIM; advising and guiding them through the admission process and providing continued support and advice after admission; and ensuring compliance with the various AIM rules.

On the other hand, the Nomad stands primarily accountable to the London Stock Exchange and Financial Conduct Authority, bearing the onus of considering and ensuring the initial and continued suitability of companies admitted to AIM.  The Nomad has a substantial part to play in the safeguarding of the integrity and reputation of AIM, which are the key ingredients for AIM’s continued growth and success.

Proper and extensive due diligence is vital in this regard.

The AIM Rules for Nomads clearly sets out the minimum due diligence obligations and requirements of Nomads when considering the suitability of companies and any reputational risks.

Breach of these rules could have grave consequences, including being reviewed by the LSE and having sanctions imposed.

TenIntelligence assists Nomads to comply with these requirements and obligations by providing concise investigative due diligence, research and vetting of companies, their directors, key employees and any potential advisers.  We fully understand and appreciate the importance of providing information that is accurate, complete and not misleading, especially where such information is relevant to the content of the admission document. 

Areas of due diligence we specifically cover are as follows, although any due diligence exercise will be tailored to the Nomad’s exact requirements and instructions:

In relation to UK and non-UK directors, key employees and/or consultants our standard due diligence will cover the following:

  • detailed background screening searches
  • identification of adverse information and risk
  • review and verification of information provided in the directors’ questionnaires
  • review and verification of curriculum vitae
  • past and present directorships
  • financial regulator, sanctions and Politically Exposed Person searches
  • details of any personal bankruptcies or business insolvencies
  • review and verification of references

In relation to the company seeking admission and its business (including companies incorporated outside the UK):

  • confirmation of incorporation
  • confirmation of existing shareholders
  • investigations in relation to substantial shareholders and/or any persons exerting control over the company
  • investigations in relation to the public standing and reputation of the company/business/subsidiaries
  • verifying ownership of assets
  • checking the validity and ownership of trademarks, domain names or brand names

Further to the standard due diligence searches, we also offer the following:

  • review of material commercial contracts for change of control clauses
  • review of standard trading terms of business
  • review of shareholders agreement, articles of association and share option arrangements in relation to exit provisions and strategies
  • review and consideration of the Bribery Act policies implemented in the business

We understand that timing is key and that any significant issues that may influence the suitability of a company should be highlighted to the Nomad at the earliest possible opportunity to maximize the time available to rectify any issues and/or to avoid any excessive time and costs being incurred where issues cannot be resolved.

In addition, we provide continued investigative due diligence in relation to any newly appointed directors, employees and/or counterparties of AIM listed companies. 

The timely detection and investigation of any price sensitive information or events during a company’s time on AIM are also of vital importance to ensure that appropriate disclosures are made in compliance with the AIM Rules for Companies.

The AIM Rules for Nomads also require due diligence in respect of the Nomad itself to ensure and confirm independence and/or detect any conflicts of interest that may exist in relation to the Nomad, its partners, directors and/or employees. Executive screening and vetting of its designated qualified executives are also required.

For more information on our due diligence, intelligence and investigation services please contact one of our consultants on +44 203 102 7720.

Alternatively please email us on [email protected]




Back to Listings