Britain’s stock market can survive the wave of companies quitting to move to New York, the head of the London Stock Exchange Group (LSEG) has said.
David Schwimmer, LSEG’s chief executive, said London’s position as one of the “top three or four” markets in the world to raise money meant it could ride out the storm.
A string of companies have quit the market to move to the US in recent years, including Paddy Power-owner Flutter Entertainment, equipment rental business Ashtead and construction giant CRH.
Smaller businesses such as biotech companies Abcam and GW Pharmaceuticals have also fled.
A lack of new groups listing on the London Stock Exchange, a process known as an initial public offering (IPO), has also shrunk the size of the UK market, with no significant IPOs so far this year.
Mr Schwimmer said there was too much focus on the IPO issue and pointed out that the London market had helped companies raise £25bn last year.
He said: “London is probably third or fourth in the world in terms of being a capital raising centre.
“There’s lots of questions and focus on IPO but if you look at the capital raised in general, including the follow-ons, this is a very healthy market with plentiful liquidity and lots of activity.”
Mr Schwimmer, a US national who had a successful career on Wall Street before coming to the UK, claimed companies moving to New York had found the market harder than expected.
He said most companies struggled and there was no evidence that moving overseas paid off.
The LSEG chief said: “If you take a look at the companies that have gone from the UK to list in New York over the last 10 years it’s about 20 companies. Of those 20, four are trading up, nine are delisted, and the rest are trading down by an average of over 80pc.
“When you look at the facts and you look at the strength of the London market in terms of the broader capital raising, you look at the reforms and innovations that are coming to this market, I feel very good and very confident about the direction of travel.”
The comments come days after Glencore became the latest FTSE 100 name to say it could quit the London Stock Exchange. The commodities group said it was exploring plans to switch its primary listing to New York to achieve a higher valuation.
The recent exodus from the London stock market has prompted panic among policymakers about the future of 223-year-old exchange. Successive governments have launched a string of reforms to loosen stock market rules and encourage pension funds to invest in the market.
Since taking over in 2018, Mr Schwimmer has transformed LSEG into a data and technology giant to rival Bloomberg following a $27bn (£21bn) takeover of Refinitiv.
