On 8 June 2018, the FCA published a policy statement on the creation of a new premium listing category available to sovereign controlled companies which will be effected by an amendment to the listing rules. The FCA intends for this new category to maintain the standards of the current premium listing categories while allowing enough flexibility to enable a sovereign controlled company to fulfil the requirements.
There are three key modifications to the requirements for companies in this new category:
- Firstly, companies in this category will not need to receive prior shareholder approval for related party transactions where that transaction is with the sovereign shareholder because this would be disproportionately onerous for these companies.
- Secondly, the company does not have to enter into a controlling shareholder agreement with the issuer as this can be impractical for sovereign owners; investors are able to understand the relationship between the company and the sovereign owner using a wider pool of available information.
- Thirdly, as an alternative to equity shares being listed directly, depository receipts over equity shares in a sovereign controlled company will be eligible for listing. For this alternative to be available, the rights attached to the underlying equity must be capable of being exercised by the depository receipt holders and the depository receipt agreements must ensure this legally.
All other features of the premium listing regime apply as usual. These amendments to the listing rules took effect on 1 July 2018.
A client memorandum on this development can be accessed here:
The policy statement can be accessed here:
The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.
