London’s public markets –
a gateway to international capital
British Embassy in Madrid
May 2014
2
Our issuers operate in more than 115 different
countries across the globe
Source: London Stock Exchange statistics. Base...
3
London is home to companies from across Europe
Source: London Stock Exchange statistics. Based on country of primary bus...
4
Source: Dealogic, WFE, as of January 2014
*%Price Offer//Current - performance is market-cap weighted
**Transaction valu...
5
Money
raised (IPO)
(USD m)
Jan-Apr
2013
Jan-Apr
2014
%
change
Main Market 2,989 9,788 227%
AIM 83 2,353 2735%
Total 3,07...
6
Start - Up Early Stage Expansion Consolidation &
further capital raising
Diversification of investors, M&A
and Internati...
7
Equity AUM held in international portfolios, by exchange Q1 2014*
Source: Facset and LSE calculation
*international port...
8
London provides enhanced analyst coverage
across all sectors
Source: Bloomberg, March 2014. Data covers average analyst ...
9
0
2
4
6
8
10
12
14
16
18
1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 ...
10
Selected IPO Case Studies
10
11
Examples of recent European transactions
Mar 2014
AIM
Digital Marketing
Mar 2014
AIM
Hotel Chain
Feb 2014
Main Market
R...
Company Details
Company
Safecharge
International Group plc
Market AIM
Sector Support Services
Trading System SETSqx
Countr...
Source: FactSet – May 2014
Price chart rebased to 100 as of IPO date
Company profile
 KW launched its European operations...
Company Details
Company JUST EAT
Market HGS
Sector Specialty Retailers
Trading System SETS
Country of
incorporation
UK
Tra...
15
15*Source: Factset and CCH company Prospectus
Company Details
Company Coca Cola HBC AG
Market Main Market
Sector Bevera...
16
2m
-
100
200
300
400
500
600
Oct-12 Oct-12 Nov-12 Dec-12 Jan-13 Feb-13 Mar-13 Apr-13 May-13
Volumetraded('000s)
60
80
1...
17
4,185
4,601
5,450
0
1,000
2,000
3,000
4,000
5,000
6,000
7,000
H1 2012 H2 2012 2013 YTD
GBPm
1%
19%
36%
44%
ROW
UK
Europ...
18
Source: Bloomberg, May 2013
CCH bond maturity is 16 Nov 2016, Benchmark bond is a German sovereign bond with similar ma...
19
Prepare ahead
Early Look
Investor
Engagement
 In an increasingly crowded primary market calendar, early preparation is...
20
Contact us
For further information please refer to www.lseg.com or contact us
Luca Peyrano
Head of Italy & Continental ...
21
This document has been compiled by the London Stock Exchange plc (the “Exchange”). The Exchange has attempted to ensure...
Upcoming SlideShare
Loading in …5
×

UKTI-LSE 19/5 - how to access intnal. capital through London's public markets

691 views

Published on

Published in: Economy & Finance, Business
0 Comments
0 Likes
Statistics
Notes
  • Be the first to comment

  • Be the first to like this

No Downloads
Views
Total views
691
On SlideShare
0
From Embeds
0
Number of Embeds
2
Actions
Shares
0
Downloads
7
Comments
0
Likes
0
Embeds 0
No embeds

No notes for slide

UKTI-LSE 19/5 - how to access intnal. capital through London's public markets

  1. 1. London’s public markets – a gateway to international capital British Embassy in Madrid May 2014
  2. 2. 2 Our issuers operate in more than 115 different countries across the globe Source: London Stock Exchange statistics. Based on country of primary business. 60 + 40-59 20-39 1-19 Number of companies
  3. 3. 3 London is home to companies from across Europe Source: London Stock Exchange statistics. Based on country of primary business. Number of companies Examples of Listings Western Europe 63 AIM - 37 Main Market – 26 Southern Europe 24 AIM - 13 Main Market – 11 Israel 17 AIM - 12 Main Market – 5 Eastern Europe 45 AIM - 25 Main Market – 20 Ireland 60 AIM - 32 Main Market – 28 3
  4. 4. 4 Source: Dealogic, WFE, as of January 2014 *%Price Offer//Current - performance is market-cap weighted **Transaction value - USD(m) London is the leading market in EMEA Number of IPOs Money raised through IPOs (USDm) Daily traded value** and number of transactions Post-IPO performance* by Exchange 835 662 411 288 0 2,000 4,000 6,000 8,000 10,000 LSEG NYSE Eur EU Deutsche Börse Nasdaq OMX No. of transactions (000s) 0 20 40 60 80 100 120 LSEG NYSE Eur EU NASDAQ OMX DB NYSE Eur Amsterdam 0 5,000 10,000 15,000 20,000 25,000 LSEG NYSE Eur EU DB NASDAQ OMX NYSE Eur Amsterdam NA -6.3 24.8 32.8 33.2 -10.0 0.0 10.0 20.0 30.0 40.0 NYSE Eur Amsterdam DB NYSE Eur EU NASDAQ OMX LSEG
  5. 5. 5 Money raised (IPO) (USD m) Jan-Apr 2013 Jan-Apr 2014 % change Main Market 2,989 9,788 227% AIM 83 2,353 2735% Total 3,072 12,141 295% Follow on issues (USD m) Jan-Apr 2013 Jan-Apr 2014 % change Main Market 7,467 18,502 148% AIM 1,030 2,079 102% Total 8,497 20,581 142% Number of IPOs Jan-Apr 2013 Jan-Apr 2014 % change Main Market 9 22 144% AIM 10 25 150% Total 19 47 147% Source: Bloomberg and Dealogic, as of 30 April 2014 Jan-Apr refers to the period January 1st 2014 – April 30th 2014 0 10 20 30 40 50 60 0 5 10 15 20 25 30 35 40 45 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 VFTSE DealvalueinGBPbn Further issues New issues VFTSE London new issuance market extremely active…
  6. 6. 6 Start - Up Early Stage Expansion Consolidation & further capital raising Diversification of investors, M&A and International Expansion EU Regulated Concept & seed stage Fundingrequirement £500k £1m £100k £50k £150m £1bn Not public Exchange regulatedMarket designation Strategic consideration Official List & EU Regulated A choice of routes to market to cater for all sizes, strategies and development stages
  7. 7. 7 Equity AUM held in international portfolios, by exchange Q1 2014* Source: Facset and LSE calculation *international portfolios defined as investment in companies different to the country of domicile of the portfolio manager Top institutional investors holdings by country (as at end Q1) London Hong Kong US Regions with increased exposure compared to previous quarter are in green, and decreased in red, unchanged in black 4% 2% 3% -1% 4% -2% 2% -8% 2% -2% - 200 400 600 800 1,000 1,200 LSE NYSE NASDAQ HKSE NYSE ENXT Paris ASX NYSE ENXT Ams Bovespa TSX SGX USDbn(%changetoQ42013) UK 43% EMEA (ex-UK) 16% North America 28% Asia Pacific 11% Lat America 2% UK 4% EMEA (ex-UK) 7% North America 83% Asia Pacific 6% China 33% Asia Pacific (ex- China) 55% North America 5% EMEA 5% Lat America 2% • London’s strength in supporting international companies improved in the last quarter with 4% increase in international AUM managed out of London, more than any other financial centre. This is the third consecutive quarter that London investors increased their investment in international companies. • London listed companies continue to enjoy support of investors based outside London. North American investors have increased their holdings of the LSE listed securities second quarter in a row and now account for almost a third of equity investment based in London. After increases in the last quarter European investors kept their positions of LSE equity unchanged, while LatAm investors have increased their positions in London listed stock by 1%. 7 …And remains the heart of international investment
  8. 8. 8 London provides enhanced analyst coverage across all sectors Source: Bloomberg, March 2014. Data covers average analyst coverage across listed companies. Note: ICB sector classification Average number of analyst recommendations following listed companies, by listing venue 0 5 10 15 20 25 30 35 40 LSEG NYSE Euronext US Nasdaq HKSE TMX NYSE Euronext EU Banking Sector 0 5 10 15 20 25 30 LSEG TMX NYSE Euronext US HKSE Nasdaq Oil andGas 0 2 4 6 8 10 12 14 LSEG NYSE Euronext US TMX NYSE Euronext EU Nasdaq Diversified Industrials Technology and Healthcare (by market cap) 0 5 10 15 20 25 30 35 $0-50m $50-100m $100-250m $250-500m $500-1,000m $1,000-5,000m $5,000m+ LSEG NYSE Euronext US Nasdaq
  9. 9. 9 0 2 4 6 8 10 12 14 16 18 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 Further New 123 145 107 75 102 277 177 160 162 355 519 462 284 114 36 102 90 71 99 26 0 100 200 300 400 500 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014 UK Int'l 813 39 133136 173 214 150 122 80 1bn+500-1bn250-500m100-250m50-100m25-50m10-25m5-10m2-5m0-2m Profile of AIM companies Admissions to AIM – 1995 to March 2014 Fundraisings on AIM – 1995 to March 2014 Industries represented – by number of companies 1,094 companies, aggregate value of £78bn A snapshot of AIM Over 3,450 companies raising £38bn at admission £86bn in total (£48bn through further issues) Source: LSE statistics, March 2014 26 companies either suspended or undetermined value Oil & Gas, 132 Basic Materials, 179 Industrials, 191 Consumer Goods, 63Health Care, 68 Consumer Services, 110 Telecommunicati ons, 15 Utilities, 15 Financials, 210 Technology, 111 *ICB industry classification 9
  10. 10. 10 Selected IPO Case Studies 10
  11. 11. 11 Examples of recent European transactions Mar 2014 AIM Digital Marketing Mar 2014 AIM Hotel Chain Feb 2014 Main Market Real Estate Fund Jan 2014 AIM General Industrials Dec 2013 AIM Mining Nov 2013 Main Market Oil & Gas Oct 2013 Main Market CEE Beverages/Spirits Jul 2013 AIM Online Financial trading Jul 2013 AIM CEE Real Estate Fund Apr 2013 Main Market Beverages Nov 2013 AIM Mobile Gaming Nov 2013 AIM Online Business Services April 2014 AIM Mobile Payment Feb 2014 AIM Real Estate April 2014 AIM Fashion
  12. 12. Company Details Company Safecharge International Group plc Market AIM Sector Support Services Trading System SETSqx Country of incorporation British Virgin Islands Transaction Details Admission Date 2 April 2014 Money raised at admission $126m Market Cap at offer $404m Current Market Cap $414m Lead Managers Shore Capital Company profile  Founded in 2006, SafeCharge has become one of Europe's leading clearing companies, with a focus on the gaming industry as well as online trading companies within the FX space (Forex, Binary Options). It provides payment services, risk management and IT solutions to simplify online and mobile payments.  Between 2010 and 2013 the total value of transactions processed by the Group on behalf of merchant clients increased from US$1.6bn to US$4.8bn.  Employs 200 people in: UK, Cyprus Bulgaria, Austria and Germany. Listing story  Safecharge’s initial plan was to raise USD100mln, but ended up raising 25% more due to strong investor demand.  2nd IPO of Teddy Sagi (Israeli billionaire) who is also a majority owner of Playtech one of the world’s leading gaming software companies  The company will use the proceeds for both organic and inorganic growth  Post-IPO ownership structure will se Teddy Sagi Case Study: Safecharge Source: FactSet, April 2014 12 Post-IPO insiders/Investors Value held £m Teddy Sagi 66.7% David Avgi(CEO) 2.9% JP Morgan Asset management 6.3% Henderson Global 5%
  13. 13. Source: FactSet – May 2014 Price chart rebased to 100 as of IPO date Company profile  KW launched its European operations through Kennedy Wilson Europe Limited in June 2011 and as at 31 December 2013, KW Europe had grown to employ approximately 50 investment professionals across London, Dublin and Madrid  The Company will be well positioned to take advantage of the significant number of opportunities over the medium term to acquire high quality real estate assets from distressed sellers and financial institutions seeking to delever by divesting such assets, and thereby benefit from the improving market sentiment of the European real estate sector. Listing story  The IPO has successfully raised $1.5 billion through the issue of 91 million ordinary shares at $15 each.  The net proceedings of the placing will allow KWE to invest in real estate targets across Europe, with an initial focus on the UK, Ireland and Spain  Across the entire portfolio, KWE will not exceed a 50% leverage threshold, but individual transactions can be leveraged up to 65% at the time of borrowing. Leading institutional investors Value held $m Marketfield Asset Management 228 Soros Fund Management 194 Wellington Management 176 Janus Capital Management 93 BAMCO 30 Fidelity Management & Research 16 FIL Investments International 10 AllianceBernstein 7 Henderson Global Investors 4 Massachusetts Financial Services 3 Company Details Company Kennedy Wilson Europe Real Estate plc Market Main Market Sector Real Estate Investment & Services Trading system SETS Country of incorporation Jersey Transaction Details Admission date: 28 Feb 2014 Money raised at admission $1.5bn Current Market cap $1.7bn Sponsor Deutsche Bank Case Study: Kennedy Wilson Europe Real Estate plc 13 Pricerebasedto100 13 88 90 92 94 96 98 100 102 Feb-14 Mar-14 Mar-14 Apr-14 Apr-14 May-14 Kennedy Wilsone Real Estate plc FTSE All-Share
  14. 14. Company Details Company JUST EAT Market HGS Sector Specialty Retailers Trading System SETS Country of incorporation UK Transaction Details Admission Date 3 Apr 2014 Money raised at admission £360m Current Market Cap £1.8bn Lead Managers Goldman Sachs JP Morgan Company profile  Just-Eat.co.uk provides online takeaway ordering services to web surfers with some restaurants they could choose from.  The Company has a leading position in the majority of the 13 markets in which it operates, including the U.K., Denmark, France, Canada, Ireland and Spain.  Since the first Just Eat website was launched in 2001, the company has grown significantly, predominantly organically but also via selected acquisitions and today partners with over 36,000 takeaway restaurants globally.  The Company was founded in 2001 and is located in Borehamwood, United Kingdom. Listing story  Just Eat is the first company to be admitted to LSE’s High Growth Segment.  The company, which operates the world’s largest online marketplace for restaurant delivery , raised £360 million at IPO, making it the largest internet company to float on London Stock Exchange 2014YTD.  The Offering consisted in £100m primary offering together with secondary offering tranche of between £70m and £200m.  Selling Shareholders include SM Trust, Index Ventures, Vitruvian Partners, Redpoint Ventures and Greylock Partners. Case Study: Just Eat Source: FactSet, April 2014 Price performance is intraday and refers to the IPO date 14 240 250 260 270 280 290 300 08:05 09:05 10:06 11:15 12:26 13:27 14:28 15:37 Price(GBp)
  15. 15. 15 15*Source: Factset and CCH company Prospectus Company Details Company Coca Cola HBC AG Market Main Market Sector Beverages Admission to Premium Segment 29 April 2013 Country of incorporation Switzerland Sponsors Credit Suisse, JP Morgan Currency GBP London 87% New York 1% Athens 12% London 1% New York 11% Athens 88% CCH - volume traded, comparison across the venues • Transfer to London had a positive effect on share performance and volume immediately upon announcement. • Investor and advisory community agreed that access to the larger and more sophisticated market better reflects the valuation of the company and its global share register • London, as a global centre of finance, is in a better position to cater for a company with global operations such as Coca Cola HBC “…London listing will give us greater recognition among international investors, will increase the liquidity of our stock and improve our access to the international equity and debt markets…” Dimitris Lois, CEO Case Study: Coca Cola HBC AG Before London listing After London listing
  16. 16. 16 2m - 100 200 300 400 500 600 Oct-12 Oct-12 Nov-12 Dec-12 Jan-13 Feb-13 Mar-13 Apr-13 May-13 Volumetraded('000s) 60 80 100 120 140 160 Oct-12 Nov-12 Dec-12 Jan-13 Feb-13 Mar-13 Apr-13 May-13 PriceIndex Coca Cola HBC AG - Immediate performance improvement Source: Bloomberg, May 2013 CCH receives regulatory approvals for the commencement of the acceptance period (trading in the stock more than doubles) CCH announces move to London (7% share price increase) Trading in London starts Average daily volume for the period CCH - Trading and price performance 1m 1.1m 963k 5m 16
  17. 17. 17 4,185 4,601 5,450 0 1,000 2,000 3,000 4,000 5,000 6,000 7,000 H1 2012 H2 2012 2013 YTD GBPm 1% 19% 36% 44% ROW UK Europe ex-UK North America Valuation enhancement as part of the London listing process Source: Factset and Bloomberg, May 2013 Market Capitalisation, expressed in millions GBP, is computed as an average over the relevant time period 17 Before announcement After announcement 13.8x 13.2x 14.5x 17.9x 20.4x 28.9x 7.1x 7.0x 7.3x 8.2x 9.1x 9.9x - 5 10 15 20 25 Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013 Q2 2013 P/E NTM EV/EBITDA NTM YTD Average valuation by quarter CCH – market capitalisationInstitutional ownership geographic breakdown Coca Cola HBC AG - Q1 2014 Q1 2014
  18. 18. 18 Source: Bloomberg, May 2013 CCH bond maturity is 16 Nov 2016, Benchmark bond is a German sovereign bond with similar maturity 18 0 50 100 150 200 250 300 350 Sep-12 Oct-12 Nov-12 Dec-12 Jan-13 Feb-13 Mar-13 Apr-13 May-13 spread(bps) 0 0.5 1 1.5 2 2.5 3 3.5 4 Sep-12 Oct-12 Nov-12 Dec-12 Jan-13 Feb-13 Mar-13 Apr-13 May-13 yield(%) Benchmark Bond Yield CCH Bond Yield Announcement of CCH’s planned move to London, 100bps drop in the corporate bond spread Since the announcement, CCH bond spread tightened to 143 bps from 276 bps Since the announcement CCH cost of refinancing decreased by 144 bps CCH – bond spread and yield Spread to benchmark Coca Cola HBC AG - Listing in London reduces cost of CCH’s other sources of funding
  19. 19. 19 Prepare ahead Early Look Investor Engagement  In an increasingly crowded primary market calendar, early preparation is critical  Very hard to accelerate an IPO process, so early preparation enhances ultimate timing flexibility  As activity increases, pressures / bottlenecks are likely to increase within advisory community – choosing the right advisers therefore increasingly important  Buyside fund managers have been vocal in the past about wanting to meet management teams ahead of an IPO  This practice of “early look” engagement with a number of the key investors has been very valuable:  Feedback for the Company and owners at an early stage on the business model, the management team and likely valuation parameters  Investors get an opportunity to build a rapport with management at this early stage, enhancing their likely participation at the IPO  Information at this stage can be carefully managed, such that management teams are not held to specific forecasts later at the time of the IPO Demand Patterns have Shifted  In recent UK IPOs, participation from US investors (who are significantly underweight Europe still) has typically totalled 30-50% of gross demand  Appetite from retail both directly (spill-over from Royal Mail effect) and through intermediaries has been strong and merits real consideration, especially for consumer-oriented businesses  Important to consider complementary distribution platforms in IPO syndicates to tap all of these pockets Appetite Broad Based  We have seen transactions over the last 12 months across all sectors – quality businesses will be well received  Royal Mail and Merlin IPOs, as well as jumbo placings in Lloyds Bank, Direct Line, indicate capacity for significant sized transactions  Particularly successful have been consumer-facing companies with strong brands (Countrywide, Foxtons, Conviviality / Bargain Booze)  Secondary components at IPO have been accepted, but the best performers (Countrywide, HellermanTyton, Stock Spirits, Foxtons) have seen further monetisations since IPO at substantially improved price levels Observation Comment Lessons Learned from Recent IPOs
  20. 20. 20 Contact us For further information please refer to www.lseg.com or contact us Luca Peyrano Head of Italy & Continental Europe Primary Markets +44 (20) 77973340 lpeyrano@lseg.com Axel Kalinowski Manager - Continental Europe +44 207 797 4108 akalinowski@lseg.com
  21. 21. 21 This document has been compiled by the London Stock Exchange plc (the “Exchange”). The Exchange has attempted to ensure that the information in this document is accurate, however the information is provided “AS IS” and on an “AS AVAILABLE” basis and may not be accurate or up to date. The Exchange does not guarantee the accuracy, timeliness, completeness, performance or fitness for a particular purpose of the document or any of the information in it. The Exchange is not responsible for any third party content which is set out in this document. No responsibility is accepted by or on behalf of the Exchange for any errors, omissions, or inaccurate information in the document. No action should be taken or omitted to be taken in reliance upon information in this document. The Exchange accepts no liability for the results of any action taken on the basis of the information in this document. All implied warranties, including but not limited to the implied warranties of satisfactory quality, fitness for a particular purpose, non-infringement, compatibility, security and accuracy are excluded by the Exchange to the extent that they may be excluded as a matter of law. Further, the Exchange does not warrant that the document is error free or that any defects will be corrected. To the extent permitted by applicable law, the Exchange expressly disclaims all liability howsoever arising whether in contract, tort (or deceit) or otherwise (including, but not limited to, liability for any negligent act or omissions) to any person in respect of any claims or losses of any nature, arising directly or indirectly from: (i) anything done or the consequences of anything done or omitted to be done wholly or partly in reliance upon the whole or any part of the contents of this document, and (ii) the use of any data or materials in this document. Information in this document is not offered as advice on any particular matter and must not be treated as a substitute for specific advice. In particular information in the document does not constitute professional, financial or investment advice and must not be used as a basis for making investment decisions and is in no way intended, directly or indirectly, as an attempt to market or sell any type of financial instrument. Advice from a suitably qualified professional should always be sought in relation to any particular matter or circumstances. The contents of this document do not constitute an invitation to invest in shares of the Exchange, or constitute or form a part of any offer for the sale or subscription of, or any invitation to offer to buy or subscribe for, any securities or other financial instruments, nor should it or any part of it form the basis of, or be relied upon in any connection with any contract or commitment whatsoever. London Stock Exchange and the London Stock Exchange coat of arms device are registered trade marks of London Stock Exchange plc. Other logos, organisations and company names referred to may be the trade marks of their respective owners. © April 2014 London Stock Exchange plc 10 Paternoster Square London EC4M 7LS Telephone +44 (0)20 7797 1000 www.lseg.com Legal disclaimer

×