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A government movement to revive the city of London with a new system for trading shares in private enterprises has been rejected by entrepreneurship capital and private capital executives as unnecessary and compared to a “new version” of the Junior market Aim of the United Kingdom Ail.
The private securities system and the exchange of capital (Pisces) – proposed by the previous conservative government and supported by the Rachel Reeves’ Chancellor – would allow investors in private companies to sell shares in regulated exchanges.
The London Stock Exchange Group is one of the companies that plans to operate a fish trading place, where shares can be marketed in a limited number of days each year.
But investors have asked how much demand he would have for the system, adding that the chiefs of fast -growing companies would be willing to choose because they would risk losing control over what owns an action in their business.
“I just don’t see who will use it,” said a partner in a senior venture capital firm. “It’s a bold solution to a problem that is much more complex than the protagonists are ready to understand.”
Hussein Kanji, who founded Hoxton Ventures, said, “What problem does this solve?” The new system would be problematic for entrepreneurial capital supporters because trading in private exchange would set a price listed for their portfolio companies that “are likely to be low and perhaps unstable,” he added .
Treasury has said that Pisces will provide fast -growing companies an incentive to be based on the UK and act as an intermediate step to finally rank in the London public markets.
The London Scholarship has undergone investment and evaluations of incorrect enterprises, with high -profile groups such as designers of ARM Holdings Chips sailing overseas and public enterprises such as the betting group, moving their primary lists in New York.
Secondary stock sales in uncomfortable companies have become widespread as companies wait longer to rank, leaving investors finding other ways to make money.
In the US, the private market Nasdaq has allowed investors and employees to trade enterprise shares since 2013, while platforms such as Crowdcube, SEEDRS and JP Jenkins enable the United Kingdom.
But multiple capital capital and private capital investors – which the government has said attract high quality businesses.
The main high -rise, fast -growing “leaders want to control” harshly “, who own their actions, especially to avoid people who throw shares on the first day of a public list, added the capital’s capital partner.
A person in an international senior private capital firm added that “it would be difficult to manage” working with shareholders who did not know.
The Financial Behavior Authority has proposed allowing “very limited” companies to impose restrictions on the types of investors that can buy their shares, including in some situations that specify a list of “specific individuals”. It has proposed allowing companies to limit the price range within which their shares can trade.
The Guernsey -based international scholarship already has a service for companies to run auction of their shares without a mediator. Cees Vermaas, Tise’s chief executive, said that based on her experience, he suspected that Pisces would be successful.
“We are skeptical that the rules (for fish) go far enough to make it a success because companies will still have requests for discovery,” he said, adding that “they will have a lot of the costs of a list of full. ”
“Pisces are not much more than a new version of Aim,” Vermaas said, referring to the market of new London shares that has suffered from a drop in lists and low liquidity, despite having less strict rules that the main market of London Stock Exchange.
FCA said Pisces “will open the door for more opportunities for investors and can transform the way private companies access investors and grow”, while the treasure said the proposal was “only part of it. To increase competition and investment “along with new ranking rules and the creation of” Megsunds “pension.
Charles Hayes, global co -director of private capital at Freshfields Legal Firm, said that “for any (acquisition executive) that tells you:” I do not want to deal with thousands of investors “, traveling is clear towards growing roads towards liquidity and.
