Fresh blow to City as software firm Wandisco eyes New York move

A leading software company is the latest London-listed company to set its sights on moving to New York.

In another blow to the city, Wandisco is exploring “an additional listing” in the US.

The £875 million cloud computing specialist, whose technology helps companies move and analyze data, said it will retain its listing on London’s junior Alternative Investment Market (AIM).

But the move by Wandisco, which was founded in 2005 in Silicon Valley and is headquartered in Sheffield and California, has raised further questions about the attractiveness of a London stock exchange listing.

His plans to explore a U.S. stock exchange listing — despite his shares having increased more than sixfold on AIM in less than a year — are following high-profile disapprovals for the Square Mile.

British microchip designer Arm said last week it will list its shares exclusively on Wall Street, dashing hopes of a double listing. Japanese owner SoftBank is said to have been put off by the city’s rules around disclosing third-party transfers.

Meanwhile, CRH, the £30 billion building materials giant, plans to move its shares to the US.

“It’s a move that seems logical for a company that does so much business to the state, but it signals further dissatisfaction with London’s ability to brand it as a global financial superpower,” said Danni Hewson, head of financial analysis at AJ. . Clock.

London-listed Paddy Power owner Flutter and education group Pearson are also considering an additional US listing, and oil giant Shell explored a move to the US before finally deciding against going.

Analysts said companies across the Atlantic are being lured by better access to capital and higher valuations, raising fears that the London Stock Exchange (LSE) is losing its appeal.

Iain McDonald, founder of investment consultancy Belerion Capital, said: “It is no surprise that Arm has chosen New York, and many other companies, particularly where the majority of their operations are based in the US, will follow suit.”

He said that if companies like Arm don’t go public in the US, they will “simply be taken over by better capitalized, higher valued US competitors.”

Adjustments to UK stock exchange rules and proposed reforms to free up huge sums of money held by the pension sector have failed to stop the flow of British companies going abroad.

LSE CEO David Schwimmer said last week: “There is no panacea to dramatically change the market environment.”

And Hargreaves Lansdown analyst Susannah Streeter said Wandisco’s planned IPO in New York showed “how much allure Wall Street has.”

She added: “Feelings remain strong that investors in the United States have more appetite for high-growth companies, which is helping to drive valuations higher, despite the resilience of the London market in recent months.

“The city has been kicking hard to attract new IPOs using the shakeup of government listing rules, but it’s an uphill battle.”

Streeter added that as concerns about the global economy mount, “companies are more inclined to take a chance on New York for their public future.”

Wandisco said it announced “a long time ago” its plans to consider an additional listing in the Americas.

The company added that it “remains determined” to maintain its London listing.