Listed UK leaving for New York...London Stock Exchange 'Great Escape'

The Financial Times (FT) reported on the 15th local time that the number of listed companies leaving the London Stock Exchange this year is the largest since the global financial crisis.

According to the London Stock Exchange Group (LSEG), 88 companies have been delisted from the London Stock Exchange or moved their main stock market elsewhere this year, with only 18 new listings.

As initial public offerings (IPOs) decrease and private equity funds take over listed companies, the net decrease in listed companies is expected to be the highest and new listings are expected to be the lowest in 15 years since 2009.

The Labour government led by Prime Minister Keir Starmer has been tightening incentives to London's financial district, including easing restrictions, since its launch in July, but there is a "great exodus," the paper noted.

Ashstead, an equipment rental company with a market capitalization of 23 billion pounds (about 41.7 trillion won), said it will move from the London Stock Exchange to the New York Stock Exchange this month.

Since 2020, it will be the sixth company in the Financial Times Stock Exchange (FTSE) 100 index, the flagship stock index of the London Stock Exchange, to leave London to go overseas.

The combined market capitalization of these six companies is 280 billion pounds (507 trillion won) as of the 13th, accounting for 14% of the total market capitalization of FTSE 100 companies.

Flutter, a gambling company with a market capitalization of 39 billion pounds (70.7 trillion won), and CRH, a building material company with a market capitalization of 44 billion pounds (79.7 trillion won), have moved to the New York Stock Exchange over the past year and a half.

Companies explain why they want to move to New York because of expectations for a wider range of investors or improved liquidity.

The FTSE 100 index, which is centered on "existing economic sectors" such as energy and mining, is up about 8% this year, compared with the S&P 500 index, where big tech companies are growing fast, which is up 27%.

Some companies have their North American businesses due to their growth.

Ested earns 98% of operating profit in the U.S.

FT's analysis based on the valuation of listed companies in the U.S. and the share of U.S. sales and North American shareholders last year showed that 18 large listed companies are likely to move from the London Stock Exchange to other stocks.

Among them, mining companies Rio Tinto and British American Tabaco (BAT) are under pressure from investors to move their main stock markets to Australian and U.S. stocks, respectively.

Goldman Sachs said in a report on the 13th that "more and more British companies are considering relocating to the U.S. and the gap in valuation between the U.K. and the U.S. is widening."

Some expect this to accelerate ahead of the inauguration of U.S. President-elect Donald Trump.

One FTSE 100 company CEO said it was "very sad" after Ashstead's announcement, predicting that Trump's "America First" could accelerate delisting or relocation.