LAST week was turbulent for construction firms whose shares are listed on the Alternative Investment Market.The hefty losses unveiled by Montpellier (see above) and a mixed statement from Interiors Services Group did little to inspire investor confidence in the junior stock market.
Yet this should not mask the popularity of Aim, which allows smaller companies to raise funds at a lower cost and with less demanding criteria than a full listing.
More construction-related companies are opting to list their shares on Aim, with Oakdene Homes, brickmaker Michelmersh and Hightower Construction among those floating recently.
Others may be encouraged after the reception given to Hightower when dealings in the shell company's shares began last week.They got off to a flying start, rising from 5p to 8.8p as investors warmed to the firm's concept of acquiring specialist outsourcing businesses that provide services to housebuilders.
The idea is to create a business giving exposure to growing housing demand without the risks of tying up working capital in a land bank.The net £430,000 it has raised through a share placing will mainly be used on due diligence and the cost of acquisitions.
The firm's first deal may be in groundworks and in the longer term it will be able to use its shares in deals and maybe bring some consolidation to a fragmented sector.
Elsewhere, the 5 per cent rise in Montpellier's share price last week - despite unveiling £15.1 million in fresh provisions - suggests the City has faith that the new controls and stronger management being introduced will restore the firm to profitability.
Meanwhile, Aim-listed support services specialist Interior Services Group, which had warned about trading earlier this year said its second-half turnover was below expectations, although its order book is up by 17 per cent.
After an initial lurch downwards, its shares seemed to stabilise at 163p as, in common with the other Aim firms, the City gave it the benefit of the doubt.