Britain made some changes to listing rules in 2021 to help
attract tech company flotations as part of a wider set of
reforms to keep London a globally competitive financial centre
after being largely cut off from the European Union by Brexit.
The decision by UK chip designer Arm to only list in New
York has added to calls for further changes, with the London
Stock Exchange saying that "pace and precision" is needed in
reforms.
"Rather than simply lamenting these decisions or insisting
that a few regulatory levers would change the outcomes, it is
important to recognise there has not until now been a
fundamental discussion about the entire ecosystem," Financial
Conduct Authority chief executive Nikhil Rathi said in a speech.
The watchdog will publish a blueprint for further reform of
the listings regime, he said.
"We plan to propose replacing our current standard and
premium listing segments for shares in commercial companies with
a single listing category with one set of requirements," Rathi
said in a speech.
"We can see the value in allowing experienced investors the
flexibility to form their own judgement in making investment
decisions based on issuers’ disclosures and rely on their
considerable negotiating power."
The watchdog will propose scrapping requiring companies to
have a three-year financial track record as a condition of
listing, a challenge for start ups, Rathi said.
A more permissive approach to dual class share structures -
whereby founders can retain control of a company - would also be
proposed.
Compulsory shareholder votes for large corporate
transactions, and for related party transactions - seen as an
issue for Arm's owner - would also be scrapped under the draft
proposals, Rathi said.
But there was a need to be realistic about how much of an
impact regulatory reform can achieve given many factors
influence where a company lists, he said.
(Reporting by Huw Jones, Editing by Louise Heavens and
Christina Fincher)
(Adds more detail)
By Huw Jones
LONDON, March 29 (Reuters) - Britain's financial
watchdog said on Wednesday it will consult on streamlining its
company listing rules to help London compete better with New
York in company floats.
It said it would consult on replacing its twin-track
standard and premium company listing regime with a single regime
and set of requirements.
Disclaimer: The views expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure accuracy of information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a solicitation to make any exchange in commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article do not accept culpability for losses and/ or damages arising from the use of this publication.