London Stock Exchange: Main Market
How to list your business on the London Stock Exchange Main Market
There are several steps you need to consider when listing your business on the London Stock Exchange Main Market.
In order to join the London Stock Exchange Main Market, you must have certain advisers in place. You may already have advisers who have the relevant public market experience, or you may need to seek recommendations to appoint new ones.
Each adviser plays a vital role in the application and admission process for the Main Market:
- A sponsor or corporate adviser - for a Premium Listing on the Main Market, you must appoint and use a sponsor to guide your company through the application and admission process, and to advise on the Financial Conduct Authority's (FCA's) legal requirements. For companies on a Standard Listing, a corporate adviser may be appointed instead.
- A broker - a broker will assist with the pricing of your shares and help generate interest in your business by marketing it when your company is admitted to trading and thereafter.
- A reporting accountant - your accountant will independently review your company's financial position and produce a number of reports to meet specific regulatory requirements and to assist the directors or the sponsor in meeting their obligations.
- A lawyer - your lawyer will be able to advise you on any legal issues that might arise as a result of your admission to the Main Market, including the necessary disclosure requirements and continuing obligations.
Preparing your company for the Main Market
You should review the following aspects of your company before beginning the listing process:
- Assets and liabilities - you must ensure that your company owns or controls all of the assets needed for the operation of your company and that you can cover any liabilities
- Shareholder arrangements - you should ensure that any current shareholders agree a time-limit restriction on selling their shares after flotation
- Share capital - you will need to organise how to split your new share capital, or re-organise the current capital you have
- Contracts - formalise any important contracts - eg for personnel, suppliers, sub-contractors, etc
- Intellectual property (IP) - ensure that any valuable IP is protected before flotation
- Insurance - ensure that all insurance policies are up to date and provide adequate cover
Your adviser will be able to provide guidance around many of these points.
Joining the Main Market
The length of time it will take to join the Main Market will depend on a number of factors, including your chosen route to market and on your company's fundraising requirements. Once you have appointed your advisers you should be able to agree a realistic timescale for joining the Main Market. Once you have appointed your advisers, you must also:
- Create your prospectus - you must produce a prospectus which will be verified by the FCA. This will also be your main marketing document and should contain enough information for investors to decide whether your business is a viable investment opportunity.
- Apply for admission to trade - you must apply to both London Stock Exchange and the FCA to admit your securities to the Main Market. The applications will run simultaneously and you must meet all the requirements of both organisations.
- Market your flotation - you should promote your flotation amongst potential investors to ensure success on admission day. Your broker will help with this.
- Complete the underwriting agreement - you should enter into a placing or underwriting agreement between relevant parties such as brokers, directors and selling shareholders.
- Hold an impact day - the impact day is when the prospectus is approved and published, and flotation is announced.
Once you have successfully completed these tasks, your company's shares will be admitted to trading on the Main Market, and trading can commence.