A bold set of proposals, to attract high-growth companies to set up global bases in the UK and to grow their businesses here, has been unveiled by the Government. The move is designed to spread the word that the UK is very much "open for business".
The plans, drawn up by both the Government and the London Stock Exchange, will act as a stepping stone for companies aspiring to achieve a full Premium Listing. The proposals incorporate a new route to the UK IPO Market for high-growth companies and include changes to eligibility criteria, reporting obligations and amendments to the rules on free float.
The new route will run alongside the existing UK markets and will be tailored to cater for ambitious companies, particularly technology and internet businesses, who are looking to finance further rapid expansion.
The plans represent an attempt to remedy the under-representation of mid-sized, high-growth European companies in the UK's public markets and form part of a larger drive by the Government, working closely with the London Stock Exchange, to reduce regulatory deterrents and widen the availability of equity capital for both British and international businesses.
Innovation in approach in this area is necessary – particularly if the UK is to keep up with the US, where legislation aimed at cutting down red-tape and facilitating access to the US public markets for high-growth companies has recently been introduced. The Government believes that this latest announcement will serve to illustrate that the UK is live to the dynamic needs of these businesses.
The new proposals will sit alongside the ongoing investigation by the FSA into the current listing regime. Further details are expected to be announced before the end of the year, and it is likely that a consultation period will follow.