Having been trailed at the end of August, the FT confirms this morning that the UK government is to consult on measures designed to encourage high-growth tech companies to list on London:
- Shares in public hands requirement to be reduced to 10% from 25%.
- Three year past accounts rule to be relaxed.
- Requirement for independent non-executive directors to be reduced.
The consultation will be announced today.
UPDATE: BIS has now given some more details of these “ambitious proposals with the London Stock Exchange to attract entrepreneurs and high-growth companies” to IPO in London:
“Proposals will include a planned new route to the UK IPO market for high-growth companies, which is likely to feature reformed rules on free float, eligibility criteria and reporting requirements. This will ensure that the needs of dynamic businesses – particularly internet and technology companies – and their investors are met. Acting as a ‘launch pad’ for companies seeking a full Premium Listing, this is aimed, in particular, at European mid-sized high-growth businesses which are currently under-represented on the UK’s public markets.”
This new route is expressly aimed at competing with the liberalised US JOBS Act listing regime:
“President Obama’s JOBS Act streamlined the regulatory burden for growth companies listing on US public markets. These new proposals will now make the UK an equally attractive and competitive listing destination for high-growth businesses and are part of a larger ongoing process of ensuring that public markets continue to meet the funding needs of growing, ambitious companies.”
BIS tells us that the new route to market will “complement” the UK’s existing markets, including AIM and the Premium segment of the Main Market. But it seems that the Government is in no great rush to put any detail on the bones of today’s announcement, as “further details” – and we hardly have any details at all – on the eligibility criteria and benefits of the new route to market will only be published “before the end of 2012″.
John Gapper in the Financial Times on why this is not a good idea and won’t work anyway here.
See also: The JOBS Act: Relaxation of rules for IPOs and private placings, and encouraging crowdfunding
