Rishi Sunak welcomes review of equity raising on UK public markets

The Chancellor of the Exchequer has welcomed the results from a review launched last year into equity raising on UK public markets.

The UK Listing Review, led by Lord Hill, was launched by Chancellor Rishi Sunak in November last year in a bid to further enhance the UK’s position as an international destination for equity listings.

The review examined how companies raise equity capital on UK public markets and made a series of recommendations on how the process could be improved.

Key recommendations included the modernising listing rules to allow dual class share structures in the London Stock Exchange’s (LSE) premium listing segment, giving directors enhanced voting rights on certain decisions, reducing free float requirements, an annual report on the City and a rebrand of LSE to appeal to a wider range of companies.

The review has also called for a fundamental review of the prospectus regime so that admission to a regulated market and offers to the public are treated separately, as well as liberalising rules regarding special purpose acquisition companies (SPACs).

Rishi Sunak, Chancellor of the Exchequer, commented: “We asked Lord Hill to lead this review because we wanted bold ideas. The UK is one of the best places in the world to start, grow and list a business – and we’re determined to enhance this reputation now we’ve left the EU.

“That means boosting the UK’s business environment and making sure we continue to lead the world in providing open, dynamic capital markets for existing and innovative companies alike, whilst protecting the high standards that underpin our status as a world-leading financial centre.

“The Review has more than delivered and I’m keen we move quickly to consult on its recommendations, cementing the UK’s reputation at the front of global financial services.”

Lord Hill of Oareford, chair of the Listing Review, added: “The proposals we are announcing today are designed to encourage investment in UK businesses, support the development of innovative growth sectors such as tech and life sciences.

“[They are also designed to] benefit the companies who choose to float in London, simplify and streamline processes, encourage a more dynamic regulatory regime, and improve the UK’s competitive position, ultimately providing more opportunities for millions of investors to share in growth.

“The UK needs to keep working at improving its reputation as a well-regulated global financial centre that is open for business. It is therefore vital that this is not seen as a one-off exercise.

“That’s why we recommend that the Chancellor should produce an annual State of the City report, bringing together Ministers, regulators and all sections of the market to ensure the whole system is working together to promote the attractiveness of the UK as an international financial centre.”