"The FTSE is down but not out"
[Re: London over and out: CRH confirms New York listing swap after ‘strong support’ from shareholders, April 26]
Charlie Conchie’s article rightly spares no punches on building giant CRH’s switch to a New York listing. A range of factors are drawing more firms to the US. There are ongoing concerns about the stability of the UK trading environment, especially the long-term effects of Brexit. A US listing also provides access to more capital, all in a risk-tolerant market that is much more receptive to backing cutting-edge products - even at earlier stages of company growth.
So how can we avoid repeats of CRH and ARM? To incentivise firms to list domestically, we need to establish a business environment built on access to growth capital, fostering innovation, and supporting growth.
This will likely require changes to the FTSE listings rules, which look increasingly antiquated compared to other markets. Then we need an ambitious plan from the UK government to steer the giants of private capital to back UK plc. Recent ideas, as covered in this paper, like the plan to get major pension funds to back a proposed UK sovereign wealth fund, are exactly the bold steps needed.
The time to act is now. London needs to demonstrate why it remains the best place for firms to raise funds and grow their business. Should this fail, other listing options in financial centres like New York, Paris, or Amsterdam will be waiting.
Naureen Zahid, Director, Investor Relations at OpenOcean
Read the original Letter to the Editor on City AM, London’s most-read financial and business newspaper.