London is set to witness the launch of a new private company stock market called Pisces later this year, as confirmed by HM Treasury and the UK financial regulator. The platform, proposed by Rachel Reeves, aims to facilitate secondary trading of private company shares for institutional investors and employees. Pisces will allow companies to control share prices and buyer selection, offering an alternative to traditional listings on AIM or the main market.
The Financial Conduct Authority has unveiled the rules for the Private Intermittent Securities and Capital Exchange System, known as PISCES, to cater to the increasing trend of companies staying private for longer durations. This initiative opens avenues for private companies to engage in intermittent share trading without the stringent requirements of a full market listing, potentially reducing costs and disclosure obligations.
During the initial four-year ‘sandbox’ period, City firms can apply to operate their Pisces platforms, with a view to enhancing the regulatory framework before its permanent establishment in 2030. Simon Walls from the FCA anticipates that such platforms will enhance investor access to innovative companies while providing early backers and employees with opportunities to trade shares.
Analyst Dan Coatsworth views Pisces as a unique stock market model that could offer private companies exposure to diverse shareholders and prepare them for potential public listings in the future. The CEO of Globacap, Myles Milston, envisions Pisces as a game-changer that could revolutionize the private markets landscape by facilitating capital influx and streamlining access to funding without the complexities of an IPO.
Jason Hollands, managing director of Evelyn Partners, sees Pisces as an innovative addition to the UK’s capital markets, bridging the gap for companies not yet ready for IPOs but considering public market entry eventually. While it may impact AIM to some extent, Pisces is not positioned as a direct replacement, lacking public access and capital-raising capabilities.
Despite the evolving financial landscape, AIM continues to play a vital role in providing growth funding and liquidity to companies. The launch of Pisces marks a significant milestone in unleashing potential investments, creating a safe environment for real-time testing of new market infrastructure, as highlighted by Myles Milston.
As the UK prepares to introduce Pisces, industry experts believe it will introduce a fresh dimension to the financial ecosystem, offering a stepping stone for private companies eyeing future public listings. While it may impact existing market dynamics, Pisces is poised to redefine how private companies engage with investors and access capital, setting the stage for a dynamic shift in the financial landscape.
📰 Related Articles
- How Market Holidays Impact Bombay Stock Exchange Trading Strategies
- Xerox Boosts Market Presence with Lexmark Acquisition, Stock Surges
- Why Bombay Stock Exchange Closes on Maharashtra Day and Market Holiday Impact
- US-China Trade Talks Impact Stock Market Performance
- US Stock Market Shows Signs of Sluggishness Amidst Uncertain Momentum