London Stock Exchange looks to speed up IPO process

LaToya Harding
·Contributor
·3 min read
LSE is pushing for the UK government to speed up the time it takes for a company to float on the exchange which would fall more in line with current procedures on US and continental exchanges. Photo: Tolga Akmen/AFP
LSE is pushing for the UK government to speed up the time it takes for a company to float on the exchange which would fall more in line with current procedures on US and continental exchanges. Photo: Tolga Akmen/AFP

The London Stock Exchange Group (LSE.L) is seeking to shorten the process for initial public offerings (IPOs) as part of a new review of its listing rules.

It is pushing for the UK government to speed up the time it takes for a company to float on the exchange which would fall more in line with current procedures on US and continental exchanges, Bloomberg reported.

At the moment, IPOs take five weeks in London from publication of the registration document to a stock’s trading debut. In 2018 the UK market regulator added an extra seven days onto the process to allow unconnected analysts earlier access to information.

According to the Bloomberg source, the new proposals would still give analysts enough time to form a view about the company and relay information to investors.

UK regulators are looking into possible changes to the listings regime in a bid to attract more listings from innovative companies.

The news follows a recent IPO bonanza on Wall Street last year, which saw companies such as Airbnb (ABNB), DoorDash (DASH) and Snowflake (SNOW) list on the New York stock exchange.

However, last year was a slightly more subdued year for stock market floats in the London market with The Hut Group (THG.L) the highest profile one to come to market. When it launched in September it was at a premium from its 500p offer price, and with a £5bn valuation.

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Since then Moonpig Group and Dr Martens have already announced plans to float in the next few weeks.

The conic British bootmaker confirmed on Monday it will float on the LSE in February after more than 60 years in business.

Final offer pricing will be announced following the book-building process, although it has been reported elsewhere that it could be worth as much as £3bn.

Goldman Sachs (GS) and Morgan Stanley (MS) are joint global co-ordinators for the offering, while Barclays (BCS), HSBC (HSBA.L), Bank of America-Merrill Lynch (BAC) and RBC Europe have been roped in as joint bookrunner in Europe.

The float comes nearly seven years after the company was bought by private equity group Permira Sales for £300m.

Meanwhile, online greeting card retailer Moonpig, is set to reveal a plan to float on the London stock market this month, in a move that could value the company at £1bn ($1.36bn).

Citi bank and JP Morgan are leading the listing, which will value the company at more than £1bn, and potentially as much as £1.5bn

Michael Hewson of CMC Markets said: “Let us hope that these new IPO’s turn out to be the first of many for the London market this year, however their success is likely to be more dependent on obtaining a realistic valuation, than any economic recovery story over the rest of this year.”

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