Chris Locke, Financial Services Strategy & Transactions Partner at EY, comments on the Chancellor’s announcement on the UK Listing Review:
“Post-Brexit, the UK Government is taking action to ensure the City can continue to effectively compete with other global financial centres in attracting fast-growth companies. The Listing Review, supported by EY, raises the UK’s competitive market position whilst retaining the strong standards of governance that make the City an attractive destination for both companies and investors - the proposed reforms will make the UK a more attractive place to IPO.
“Among the 14 key proposals announced in the Review is the extension of the use of dual-class shares to the Premium Segment. With appropriate safeguards, this will allow business founders to keep control over their companies by giving them deciding votes on issues such as corporate takeovers, in turn giving them greater confidence that they can focus on the growth of their business post listing. The Review also recommends reducing the minimum free float level from 25% to 15% to widen the net of companies looking to list and attract them earlier in their valuation journey. And crucially for UK attractiveness and to increase the routes to a UK IPO, the Review recommends revising the listing rules around SPACs (special purpose acquisition companies) to enable their effective use in the UK market.
“If implemented, the proposals published today will strengthen the UK’s post Brexit, post pandemic position on the global business stage. It is critical that the positive momentum of the Review is captured as it moves to consultation and implementation.”