Initial Public Offerings

  • Share

Which London exchange is right for you?

Why London?

The continuing growth of London as a centre of global finance in many fields is now widely acknowledged. Many industries are increasingly looking to the London markets as a natural home with sophisticated global investors who understand the developing markets.

When you join the London Stock Exchange you will be part of one of the world’s established, best known and liquid markets. In recent years some of the most prestigious companies in the FTSE 100 and 350 have all preferred to list in London.

  • Liquidity reasons – depth of the market
  • Sophisticated investors with extensive funds, offering liquidity
  • Broad, in-depth sector and company coverage by analysts
  • London is a leading centre in the world for new issues
  • More flexible, and therefore less expensive.

Two London exchanges

Main market

Admission criteria

  • Minimum 25% shares in public hands
  • Normally three years trading record required with certain exemptions for select sectors
  • Prior shareholder approval required for substantial acquisitions
  • Sponsors needed for certain transactions
  • Minimum market capitalisation (£700k)
  • Pre-vetting of admission documents by the UKLA

Key rules for listing of shares

  • Appointment of a Sponsor
  • Production of a Prospectus
  • Sufficient working capital for at least 12 months from date of prospectus
  • Comply with Listing Principles, establish and maintain adequate financial reporting procedures (FRPs)
  • Three years record (under IFRS) for at least 75% of the entities business of:
  • Control over majority of entity’s assets.

Other acceptable GAAPs

  • Financial information for three years prepared in accordance, US, Canadian or Australian IFRS GAAPs and other GAAPs deemed to be acceptable.

Alternative Investment Market (AIM)

Admission criteria

  • No minimum amount of shares has to be in public hands
  • No trading record requirement (but if you have one, it be must included)
  • Nominated advisor (‘NOMAD’) required at all times
  • No minimum market capitalisation
  • Pre-vetting of admission documents by the NOMAD unless a prospectus is required

Key rules for listing of shares

  • Appointment and retention of NOMAD and broker
  • Normally, production of an admission document
  • Sufficient working capital for at least 12 months from date of admission document
  • Adequate financial reporting procedures (FRPs)
  • Financial information for three years (if available) prepared in accordance under IFRS. IFRS is only mandatory for EU incorporated companies from 1 January 2007
  • Transitional provisions in respect of financial information prior to 1 January 2007
  • The AIM continues to monitor the Main Market and GAAPs which could be deemed acceptable in the future.

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