The UK Financial Conduct Authority (FCA) is proposing a new stock market listing category that will exempt companies controlled by sovereign states from certain requirements.
"Refining the listing regime in this way would make UK markets more accessible whilst ensuring that the protections afforded by our premium listing regime are focused and proportionate," FCA chief executive Andrew Bailey said on Thursday.
The development comes at a time when London is trying to woo Saudi Aramco, which is planning what could be the world’s largest initial public offering.
The UK market regulator Thursday announced a consultation paper proposing two key exceptions. The moves could inch London ahead in the competition to lure Saudi Aramco which aims to raise as much as $100 billion.
Under the proposed changes, sovereign shareholders will not be considered related parties and exempt from the rules on deals between a listed company and its directors, substantial shareholders or their associates. The FCA also wants to absolve those controlling shareholders from rules that apply to their transactions with the listed company in the present listing regime.
An Aramco listing would be a boost to post-Brexit London, helping politicians make the case that the UK is open for business and remains a financial hub even as it leaves the European Union - and its single market. The London Stock Exchange’s premium listing segment has stricter rules and reporting requirements than a standard listing. It also has access to a wider pool of investors and large companies typically list on the premium segment.
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