Aim feels the pinch as flotations falter on risk-wariness

FUNDS raised on the Alternative Investment Market (Aim) plunged 38 per cent to £247 million in the first three months of this year as ongoing economic concerns saw investors back only the safest bets.

Despite expectations that 2010 would be the year of the "great flotation", investors remained jittery, causing a string of businesses to postpone or cancel fundraising initiatives, including Panmure Gordon analyst Sandy Chen's planned flotation of his banking venture, Walton & Company. Just 17 companies collectively raised 247m, down from the 396m seen in the previous quarter.

Although disappointing, the figures are an improvement on the same period in 2009 when market fears saw a collapse in initial public offerings. The sum raised in the first quarter of this year was 82 times higher than in the same period in 2009, when four Aim-listed firms collectively raised a paltry 3m.