LONDON (Businesshala) – Britain has launched a rapid review of how listed companies can raise money on stock markets, its latest move to put London at the forefront of global financial hubs after Brexit.
UK markets raised £30bn ($41bn) in new equity last year as companies sought to shore up their finances during the pandemic, but most businesses traded with a small group of institutions instead of using stocks. increasingly opted to raise funds through private placements. Market.
The review will look at how technology can ensure shareholders get information faster and reduce the period during which they exercise their rights.
“There exists an opportunity for existing listed companies to facilitate a faster and more efficient process of raising capital and engage retail investors,” said Mark Austin, attorney at Freshfields Law Firm.
The UK has already completed a review of the primary listing market and regulators are expected to finalize rules that will make it easier for companies to float and help London better compete with New York in technical listings. Will get
The primary listing review by former European Commissioner Jonathan Hill recommended that the secondary capital market be reformed by re-establishing the 2008 Rights Issue Review Group.
That group, regulators and industry representatives at the Bank of England had recommended examining more accelerated rights issue models, including those used in Australia, but this suggestion was never pursued.
Hill said that since 2008 financial markets have been transformed by technological innovation that would allow alternative or additional measures to be taken to improve secondary capital raising.
Austin will focus on Australia’s use of “cleanup” notices, which update the market on new corporate information to avoid issuing a prospectus, a time-consuming and costly undertaking.
Austin will make recommendations to the government in spring 2022.
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