British Finance Minister Jeremy Hunt is reportedly devising plans to enable UK private companies to offer shares on exchanges, as per a report by the Financial Times on Saturday.
The proposed system, dubbed the Private Intermittent Securities and Capital Exchange System (Pisces), aims to bridge the gap between public and private markets, providing some liquidity for shares of private companies while avoiding the regulatory constraints of a public listing, according to the FT.
Under the proposed scheme, investors would have the opportunity to sell stakes on a limited number of days, with details expected to be outlined in next week’s budget.
“This is a ground-breaking proposal for a new market that will help private companies to scale up and will boost the pipeline of future IPOs in the UK,” a source from the Treasury told Reuters.
The Pisces system would necessitate approval from the Financial Conduct Authority and could potentially commence later this year, the FT reported.
Initially introduced in 2022 as part of Hunt’s efforts to enhance London’s appeal to investors amid competition with New York for listings, the concept for Pisces resurfaces now with potential implementation on the horizon.
However, companies utilizing Pisces would be restricted from raising new capital through the system, and retail investors may not be granted access to purchase shares via this platform, as stated by an unnamed official cited by the FT.
In a separate development, Hunt unveiled the next phase of a plan aimed at partially reversing the long-standing trend of pension funds favoring secure government bonds over riskier start-ups, the finance ministry announced on Saturday.
By 2027, pension schemes in Britain will be required to disclose the extent of their investments in UK assets, according to the finance ministry’s statement.