Take that, Amsterdam (and New York)! Takeaway food delivery firm Deliveroo has confirmed that it plans to list its shares in London.
The technology company, which is expected to have a market capitalisation of around US$7bn when it floats, is set to take advantage of controversial new proposals to relax restrictions on dual-class shares, which typically are designed to ensure the founders of a company can more easily maintain control of their “baby”.
In years gone by dual-class share structures were typically favoured by Britain’s “beerage” – (erstwhile) brewers such as Fuller, Smith & Turner and Young & Co – but they are all the rage among technology companies in the US, where being a control freak is often seen as being a good thing (especially by the founders).
The UK’s distaste for dual-class shares was in danger of leading to London missing out on sexy and highly profitable initial public offerings (IPOs) by technology companies but a review of London’s listing rules, led by Lord Jonathan Hill, the former European Union commissioner, came out in favour this week of allowing dual-class structures on the main market of the London Stock Exchange.
The recommendation is seen as not only a lure to technology companies considering a listing in London but as an incentive for special-purpose acquisition companies (SPACs) – also known as “blank cheque investment vehicles” – to list in the UK capital.
“London is a great place to live, work, do business and eat. That’s why I’m so proud and excited about a potential listing here,” said Will Shu, the founder of Deliveroo.
“After eight years of operations and rapid expansion around the globe, choosing London underlines Deliveroo’s commitment to making the United Kingdom its long-term home,” the group’s statement said.
The chancellor of the exchequer, Rishi Sunak, clearly considers the decision to be a feather in London’s cap.
The Deliveroo statement included comments from “Dishy Rishi”, who has been known to moonlight as a waiter during the UK’s controversial “eat out to help out” scheme last year – a scheme that did few favours to Deliveroo.
“The UK is one of the best places in the world to start, grow and list a business – and we’re determined to build on this reputation now we’ve left the EU,” Sunak said in the Deliveroo statement.