London’s capital markets woes deepen as WANdisco eyes New York
London’s ambitions to elevate its capital markets on the international stage were dealt a fresh blow today as data firm Wandisco became the latest UK tech outfit to reveal it was eyeing a New York listing.
In a statement this morning, the AIM-listed firm said it was in the “early stages” of scoping out a dual listing in New York to sit alongside its London-listed shares.
While Wandisco reaffirmed its commitment to its London-listing, the announcement comes after a bruising week for London Stock Exchange officials in which Cambridge chipmaker Arm opted for a New York IPO and building supplier CRH announced it would swap its London listing for New York.
UK regulators and officials have been on a drive to overhaul and boost the appeal of the UK’s markets in the past two years, pushing through the Hill Review of the listings regime and the Austin Review of the UK’s secondary markets in a bid to tempt in more listings.
The Financial Conduct Authority has also ushered in reforms in a bid to ease the red tape surrounding listing in London.
However, speaking with Morning Wire, Mark Austin, partner at law firm Freshfields and the author of the Austin Review, said London needed to act fast in order not to fall behind.
“The UK is not lost but it is at an inflection point as a financial centre and listing destination. But we know what we need to do to fix it and we are doing it,” he said.
“We are already in the process of meaningfully reforming our relevant law and regulation and discussions are now also gaining momentum in relation to the changes we need to make to market practice.”
Austin added that there was now also a “crucial” emphasis on addressing “cultural and attitudinal issues around celebrating success rather than denigrating it” which would encourage a more risk-taking environment across areas like pension fund deployment to public market investor attitudes.
A more risk-friendly approach to pension investment has long been a demand of the UK’s growth sectors and is seen as key to keeping firms in the UK beyond the smaller stage.
Morning Wire revealed exclusively yesterday that pension bosses had met with fintech and tech chiefs in the City in late January to discuss a pooled £50bn growth fund, designed to tempt more firms to grow and list in the UK.
EY’s IPO lead Scott McCubbin told Morning Wire that while a shallower pool of capital in the UK was one of the fundamental issues still pulling firms to New York.
“Whilst much has been debated about the regulatory environment in London, it’s valuation not regulation which is one of the key differences between London and the New York stock exchange,” McCubbin added.