LSE needs capital to revive UK listings as 15 firms de-list

The London Stock Exchange has the regulatory machinery in place but lacks the capital to reverse a listing drought that has seen 15 companies de-list this year against just seven new entrants, deputy chief executive Charlie Walker said.

"We've got this sort of mechanically sound car now, and we just need some petrol, and the petrol is capital," Walker said in an interview.

The imbalance reflects a structural shift in global equity markets. Chip designer Arm, gambling group Flutter and fintech Wise are among UK companies that moved primary listings to New York in recent years. Last week, the Financial Times reported drug maker AstraZeneca — the second most valuable UK company — was weighing a merger with a US rival, though neither company has commented on the report.

"We should be fighting tooth and nail to retain all of our companies," Walker said.

The stakes are existential for London's status as a global financial hub. "If the UK gets to a point where it can't be home to globally consequential companies and they have no choice but to go overseas, that's really not a good place for the UK as a whole," Walker said.

Reforms Have Not Stemmed the Tide

Over the past two years, the LSE, alongside the UK's finance and markets regulators, has introduced a suite of rule changes aimed at making listing and staying listed in London cheaper and less onerous. Companies can now offer fewer shares for sale, spend less on distributing company information to analysts, and face fewer hurdles in acquiring other companies.

"Regulation very rarely now comes up in the conversations we're having with companies about whether or not they want to come to the UK or go to any other market," Walker said.

Last month, the LSE said it would introduce 24-hour trading for exchange-traded products in its latest bid to increase liquidity. The move mirrors broader industry momentum: Nasdaq plans to start trading 23 hours a day, five days a week, as does the New York Stock Exchange's Arca venue, while London's main bourse has kick-started work on a similar project.

Capital, Not Rules, Is the Missing Piece

Walker said solving the liquidity problem requires a broader cultural shift in the UK. He suggested cutting taxes on investors' gains on UK stocks and diverting more of the country's personal savings toward domestic equities.

"This is something the LSE cannot do on its own," Walker said. The shallow pool of investor cash available for London-listed companies "is more of a long-term thing for the UK."

The listing drought has persisted despite the reforms. Only seven companies have listed in London so far this year, a number dwarfed by the 15 that have de-listed. Two decades ago, US policymakers fretted that London would eclipse Wall Street as the world's primary listing destination; today, the flow has reversed.

The outcome matters beyond the exchange itself. A continued exodus of mega-cap companies would erode the UK's equity market depth, reduce index weightings, and diminish London's ability to attract global capital — a compounding problem that regulatory tweaks alone have not solved.

This article is for informational purposes only and does not constitute investment advice.