Takeovers account for more than a third of AIM delistings
Takeovers have become the leading reason companies leave the Alternative Investment Market (AIM), with acquisitions accounting for more than a third of all delistings over the past two decades, according to UHY Hacker Young.
Research by the accountancy firm found 767 AIM-listed companies have been acquired over the last 20 years, including 31 takeovers in the year to 31 December 2025.
Overall, 2,129 companies delisted from AIM during the period, with acquisitions responsible for 36% of those exits.
The research highlights the growing role takeovers have played in the shrinking size of London’s junior stock market.
The number of companies listed on AIM has fallen from 1,694 at the end of 2007 to 612, as acquisitions, insolvencies and strategic failures have outpaced new listings.
UHY Hacker Young chairman Colin Wright said private equity firms and corporate buyers increasingly view AIM-listed businesses as undervalued.
AIM market to shrink by a fifth
“There are now plenty of opportunistic funds out there that will take advantage of even a relatively temporary slump in an AIM company’s market capitalisation,” he said.
“Those acquirers see the strong prospects of AIM companies and have been willing to pay more than institutional investors have been willing to pay for those growth companies.”
Wright said the steady loss of successful companies was making AIM less attractive to prospective issuers, despite reflecting the quality of businesses listed on the market.
“While that is a great compliment for AIM companies, the gradual erosion in the size of AIM is not helping it attract new listings. The takeover of many of AIM’s best companies makes AIM seem far less dynamic than it is,” he said.
He also questioned whether UK boards should have greater scope to reject bids they believe undervalue a company’s long-term prospects, suggesting recent reforms allowing dual-class share structures could help reduce opportunistic takeovers.
Beyond acquisitions, failed business strategies were the second-largest cause of delistings, accounting for 303 companies, or 14% of the total over the past 20 years.
Financial stress or insolvency was responsible for 434 delistings, representing 20%, although its share has fallen in recent years as the overall quality of AIM-listed businesses has improved.
Wright welcomed recent London Stock Exchange reforms aimed at reducing the cost and regulatory burden of listing on AIM but said further changes were needed to encourage more initial public offerings.
“We need to make it easier to undertake an IPO on AIM,” he said.
“Delistings are only really a problem when they aren’t being balanced off by new listings on AIM.”
