The U.K.'s Financial Conduct Authority has proposed merging
its premium and standard listings into a single category to make the
listing process more accessible, which it hopes would entice companies
to list on the London exchange.
With the changes proposed,
organizations would be able to maintain two classes of shares even after
going public and remove the mandatory shareholder votes. However, the
move could potentially "bring in more risk to our market," acknowledged
FCA's director of market oversight, Clare Cole.
- The FCA added that any changes in regulations could potentially reduce investors' protections.
- Ashurst's
head of equity capital markets, Nicholas Holmes, welcomed the changes
but played down its impact, saying "The challenges to London's equity
capital markets status run much deeper."
- The
changes are aimed at making the nation more attractive as an IPO
listing hub and to ward off competition from New York and Asian hubs.
- The
number of listings in the U.K. has dropped due to reduced market
liquidity after Brexit and lower investor appetite for growth stocks in
the nation.
- Earlier this week, British microchip design firm Arm filed for an IPO listing in the U.S. after briefly considering a dual listing in the U.S. and the U.K.
- Arm — which reportedly intends to raise $10B (£8B) at the upcoming IPO — slammed the FCA for not relaxing transaction rules.
