Watchdog races to change listing rules to attract more innovative tech companies to town
The city’s regulator is rushing to change admission rules to attract innovative tech companies to join the London Stock Exchange.
The Financial Conduct Authority (FCA) has proposed a series of reforms that include cutting shares that must be publicly owned amid fears that London will lose native talent to New York.
It has launched a 10-week consultation and aims to initiate reforms by the end of the year.
Tech Floats: The Financial Conduct Authority has proposed a series of listing rules reforms amid fears London will lose native talent to New York
Though London has won high profile floats like Deliveroo and Darktrace this year, the planned redeployment comes as artificial intelligence startup Onfido said it was preparing to take London for New York and Immunocore, a UK biotech that in the US in February.
The FCA has proposed that companies with a premium listing on the LSE – such as BP, Tesco and Barclays – allow stock structures with two classes for the first time.
This would give bosses and founders far more power over the company’s future if it is public, as some stocks have more voting rights than common stocks.
It could upset the city’s old guard, however, as many prefer a share-a-vote.
The FCA has also proposed amended requirements that a company must be worth at least £ 700,000 when it goes public.
According to the proposals, companies would have to be worth at least £ 50 million to use the main market only for more established companies.
Smaller, high-growth companies would have to join exchanges such as AIM and the Challenger exchange Aquis.