London- The Financial Conduct Authority suggests new rules that would create a new category of firms’ listings that are controlled by states in UK stock exchange markets.
These suggestions coincide with a competition among stock exchange markets around the world to win the listing of Aramco – controlled by the government – that is expected to be the biggest IPO in history.
Britain wants to loosen rules on listing state-companies in a move that could help London win the lucrative IPO of oil giant Saudi Aramco, reported Reuters.
The Financial Conduct Authority’s proposals on Thursday would create a new listing category for companies controlled by sovereign states. The authority added that there is a gap in the UK listing rules when it comes to firms controlled by sovereign establishments.
In the current time, firms that can’t comply with the premium listing requirements should be enlisted in the standard category, which is viewed as a less attractive level for investors and companies.
London stock exchange is capable of reaching out to a wide group of investors and giant firms, which is an attractive element to the IPO – listing a company as giant as Aramco in UK stock exchange would positively reflect on the capital of funds and international business.
“This is a clever solution to the dilemma of Aramco,” Edward Bibko, head of capital markets in Europe, Middle East and Africa at law firm Baker McKenzie, said, affirming that the business sector will benefit from this new category.
During past months, Saudi officials said that they are looking forward towards listing up to 5% of Aramco in Riyadh and the world. Competition is fierce among stock exchange markets of London, New York, Hong Kong, Tokyo and Singapore to win this listing.