If you are thinking ahead and can see the day when your insurtech baby flies the nest and becomes a PLC, with a stock market listing, then the experience that WISE had on the London Stock Exchange is worth noting.
Susannah Streeter, senior investment and markets analyst, Hargreaves Lansdown comments;
‘’WISE may have flown into the stock market blindfold, given that by choosing a direct listing, its share price wasn’t decided in advance, but the payments firm has had a smooth landing, with shares rising since trading began.’’
There were 47 million trades in the first half hour, pushing the price up by 3% from the opening auction price of 800p (total trades, not trades just through HL). Shares came out of auction at 820p before dropping slightly and then rebounding to 825p by midday. The launch has put a value of the company of around £8 billion, a big step up from the £5 billion price tag attached to the company by private investors last July.
The unruffled start to trading should help London’s efforts to maintain its reputation as a Fin Tech hub as it has struggled to attract fast growing companies keen to list. The UK has gone out of flotation fashion with just 5% of companies delivering an IPO choosing London as the launch pad. This particularly worrying because we see IPOs as an opportunity to bring more people to investing for the first time
But now more firms might see direct listings as a good alternative to traditional IPOs which are more costly, needing the input of expensive services from investment banks.