Listing in London

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The worlds capital market
Listing in London Santiago 12th June 2008
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Global platform for global institutional investors
144A
Local market
USA Middle East Asia
Eastern Europe Europe UK
Regional funds and retail investors
US Institutional Investors
Global institutional investor base
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London Stock Exchange - key statistics
London Stock Exchange
Total companies Domestic 2,550 International
675 Market capitalisation Main Market UK
listed US3,570bn International listed
US4,398bn AIM US181bn Turnover value (Jan-Dec
2007) Main Market US8,054bn AIM US150bn
Source London Stock Exchange statistics
December 2007
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More international equity assets under management
Equity assets under management by centre. In US
billions
London has a far bigger international presence
and weight. 45 of equity assets under management
are invested in international markets. New York
is a larger but mainly domestic market.
Source IPREO 2007
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The platform of choice for international
companies
Q1, 2008
In 2006 London Stock Exchange - 367 new
companies joined in 2006. NYSE, Nasdaq Hong
Kong Stock Exchange had 332 IPOs in 2006. 104bn
raised on the London Stock Exchange, 40bn on
NYSE, and 29bn on Nasdaq In 2007 London Stock
Exchange - 252 new companies joined the London
Stock Exchange, 142 new companies on Nasdaq, 67
on NYSE 88bn raised on the London Stock Exchange.
Source London Stock Exchange and WFE December
2007
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Leader in cumulative capital raised at IPO
General Market Summary
Source London Stock Exchange and WFE December
2007
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Comparing UK and US as listing locations

• London and New York exchanges offer optimal
  profile
• London has worlds highest reputation for
  regulation and governance
• Principles-based (UK) versus rule-based (US)
  approach
• London has the most liquid equity market in
  Europe
• London has the worlds most successful growth
  market (AIM)
• London Stock Exchange offers worlds only
  location for liquid and transparent trading of
  GDRs
• London combines simple, flexible disclosure with
  high reputation of regulators
• US disclosure regime more prescriptive,
  exacerbated by need to protect against
  opportunistic securities litigation
• London offers rapid turnaround by regulators, and
  limits the time regulators can take to approve
  offer documents
• US SEC review periods longer, with no certainty
  on turnaround time
• AIM offers potentially shorter transaction
  timetable

Profile
Trading
Disclosure
Timing
Cost-benefit analysis favours London
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Comparison of international listing locations
Optimal
Least suitable
Strategic financings from global companies will
converge on London or New York
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An intelligent approach to regulation
Balance Competing Needs
Companies
Investors
Minimise bureaucracy and cost
Maximise protection
UK
Ranked first in corporate governance standards by
GMI, Deminor and Davis Global Advisors
Principles based - comply or explain
US
Increased cost of compliance and risk premium
(Financial Executive Korn Ferry Surveys)
Rules based - prescriptive and expensive
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London Stock Exchange intelligent regulation
Corporate Governance and regulatory framework

• SarbanesOxley has increased the costs of listing
  in US
• Has it improved governance standards in USA?
• No evidence that SarbanesOxley delivers benefits
  beyond those that apply under the UK regime
• The Cost of Capital An International Comparison
  - report available here

http//www.londonstockexchange.com/NR/rdonlyres/B0
32122B-B1DA-4E4A-B1C8-42D2FAE8EB01/0/Costofcapital
_full.pdf
The UKs intelligent approach to regulation the
success of the Combined Code is the foundation
for Europes deepest pool of capital in Europe
and why our Main Market is one of the worlds
most cost-efficient to access
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Corporate governance overall rating by country
Most advanced regulation and governance
Source Governance Metrics International, 2007
Principles-based regulation high standard,
pragmatic application No equivalent to
Sarbanes-Oxley section 404
An
intelligent approach.
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Main features
London Stock Exchange
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The widest choice of proven global markets
A choice of globally respected markets supported
by a wide range of institutional retail
investors

Main Market
Supports earlier stage companies in their initial
growth period. 1,675 issuers
Supports more established companies seeking
further growth. 1,550 issuers
UK Listing Authority
Nominated Adviser (Nomad)
Sponsor
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The worlds most successful growth market
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The widest choice of proven global markets

• AIM companies 1,675
• Overseas AIM companies 343 (non UK incorporated)
  
• IPOs on AIM in 2007 182
• Total capital raised in 2007 US32.4bn
• US13.2bn New
• US19.2bn Further
• Capital raised (new further) since 1995
  US115bn

Key Statistics
Source London Stock Exchange trade statistics
April 2008
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AIM critical mass to support growth
Number of IPOs
Q1, 2008
Source London Stock Exchange trade statistics
April 2008
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AIM today
As at April 2008, there were 1675 companies on
AIM of which 343 were international with a
combined market capitalisation of 91billion. 590
companies have their primary business outside the
UK
Source London Stock Exchange trade statistics
April 2008
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Raising new and further capital on AIM
Funds raised in (bn)
Q1, 2008
2006- More money was raised on AIM in 2006
(31bn) than on NASDAQ (29bn) 2007- More money
was raised on AIM in 2007 (32bn) than on NASDAQ
(20bn)
Source London Stock Exchange trade statistics
April 2008
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AIM - company size
Source London Stock Exchange trade statistics
April 2008
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A diverse market
Top AIM sectors by market value no. of
companies April 08
Source London Stock Exchange trade statistics
April 2008
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AIM The market of choice for growing Mining
companies
Mining companies on AIM Money raised (m)
Source London Stock Exchange April 08.
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Flexible regulation
Appropriate regulation and oversight

• Admission Rules
• No minimum size to be admitted
• No minimum financial history required
• No minimum amount of shares to be in public hands
• In most cases, no prior shareholder approval
  required for transactions
• Admission documents not pre-vetted by Exchange or
  UKLA but by nominated adviser
• Nominated adviser (Nomad) required at all times

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Continuing obligations
Appropriate regulation and oversight

• AIM companies are subject to the AIM Rules which
  outline the continuing obligations of being on a
  public market. Key continuing obligations are
• AIM companies must have a Nomad at all times,
  otherwise they will be suspended from the market
• AIM companies must disclose all price sensitive
  information in a timely manner including
  substantial transactions, related party
  transaction, reverse takeovers and other
  miscellaneous transactions
• Half yearly and annual report and accounts
  required in adherence with deadlines
• All directors accept full responsibility,
  collectively and individually for the AIM Rules
• Restrictions on deals for directors and
  applicable employees on AIM securities during
  close periods
• UK Corporate Governance standards as best practice

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AIM has a deep pool of institutional investors
Institutional Investors on AIM Sector breakdown
Source GCI Institutional Investors in AIM survey
2007
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Institutional Investors on AIM Most active
Source GCI Institutional Investors in AIM survey
2007
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Institutional investors understand AIM
Leading investors

• Fidelity Investments
• Value of largest holdings, 2006
• million
• Sportingbet Leisure 268
• Imperial Energy Oil gas 117
• First Calgary Oil gas 91
• Centurion Electronics Electronics 60
• PIPEX Comms Telecoms 57
• Highland Gold Mining 53
• Clipper Windpower Electricity 47
• Star Energy Oil gas 41
• Asia Energy Coal 39
• Serica Energy Oil gas 39

• Artemis Investment Management
• Value of largest holdings, 2006
• million
• Star Energy Oil gas 60
• - Develica Deutschld Equity fund 49
• Cape Support ser 47
• Genesis Oil gas 44
• Coda Software 41
• - Speymill Real estate 30
• European Goldfields Mining 30
• Prosperity Minerals Bldg Mats 30
• Equest Balkan Real estate 29
• Imperial Energy Oil gas 28

Source Teather Greenwood, Growth Company
Investor Translated into at 1.00
1.90 Data for year 2006
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To summarise why choose AIM

• The worlds most successful growth market
• An internationally focused, professional investor
  base
• Comprehensive research coverage for international
  companies
• A more flexible approach to regulation
• Better value than NYSE or NASDAQ
• A global platform
• The Exchange of choice for companies wishing to
  access the international capital markets

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The worlds capital market

• London Listing
• Access to global capital
• Lower cost
• Lower risk
• Faster to market
• Intelligent regulation

• New York Listing
• Higher cost
• Slower to market
• Higher risk
• Sarbanes Oxley
• Section 404
• Class actions

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Contact us

• Graham Dallas
• Head of Business Development The Americas
• gdallas_at_londonstockexchange.com
• 44 (0) 20 7797 4055
• Anne Moulier
• Business Development Manager Latin America
• amoulier_at_londonstockexchange.com
• 44 (0) 20 7797 4584
• Website www.londonstockexchange.com