Cash shells are businesses with money on their balance sheet, but no trading operations that are listed on The London Stock Exchange’s AIM Stock Market and Main Market, or ICAP’s ISDX stock market.
The value of cash shells, or special purpose acquisition companies (SPACS), floated on the UK stock markets grew from around £1.2bn in 2010 to £2.5bn in 2011, and £2.7bn in 2012, demonstrating that cash shells have an important role to play in helping to fund growing companies seeking cash and a stock market listing on AIM.
For some privately owned companies, using an existing AIM cash shell can provide a less risky route to joining the market than the more conventional method of admission and fund raising.
The key benefits of reversing into an AIM cash shell are:
- There is a transparent amount of cash already in the shell ready to invest in the right company.
- By comparison with the conventional AIM flotation, the fact that cash is already in the shell means that, in some respects, a reverse into an AIM cash shell may be regarded as a lower risk. Certainly the transaction does not rely on attracting new investors to support a fundraising at the time of admission to AIM.
- A reverse transaction into an existing AIM cash shell may be quicker and therefore a less costly method of achieving an admission to AIM, and at the same time, accessing cash to grow a business.
Holland Bendelow have recently introduced the ‘AIM Cash Shells Guide’ as an essential guide to AIM cash shells, this whitepaper provides an overview for companies that may be considering a reverse transaction into an AIM cash shell and is designed to demystify the process of undertaking reverse transactions and removes some of the unnecessary city jargon. Interested in learning more then download the AIM Cash Shells Guide for FREE now.
Our new guide has been published to demystify what cash shells are, and how companies can access cash shells to raise funding. The guide provides a step by step guide to cash shells on the UK Stock Markets including, AIM, The London Stock Exchanges Main Market, and ISDX. The guide is essential for companies and advisors investigating gaining a stock market listing via a cash shell.
This guide is more of a beginners guide and covers all of the Stock Markets but in less detail than the previous AIM Cash Shell Guide and as such it is recommended that you go on to read the bigger guide.