Indaba 2021 Blog: challenges, successes and a new path forward

Looking back

At the beginning of the global pandemic there was significant concern over the London Markets’ capacity to support companies’ response to the COVID-19 crisis. However, it is clear now that London exceeded expectations and maintained its momentum throughout the year continuing to raise money even during the typical quieter summer months.

The lack of support from the private equity market meant a renewed interest in the ‘IPO option’ that may not have been expected 12 months ago. Overseas companies continued to see the benefits of adding a London listing and we saw continued growth in dual listings throughout the year.

At Memery Crystal, we were extremely quick to adapt to the crisis and productivity continued unabated. Following a successful year of listings in 2019, it was fantastic to see our clients (including Pure Gold, Taseko Mines, Valuera Energy and VAALCO Energy) benefitting from increased liquidity and share price.

In times of turmoil it isn’t always easy to predict how the different sectors will respond. With countries closing borders and companies suspending operations, the natural resources sector, along with many others were undoubtedly at risk. However, one such precious metal shone through with a nearly 30% increase in gold prices over the year. While the UK market is popular with global mining companies, there are a limited number of sizeable gold companies listed in London.

We were therefore delighted to ‘set the new gold standard’ with the listing of Yamana Gold in October, the third biggest listing by market cap ($5.58 billion / £4.3 billion) of 2020.

It was a real vote in confidence in London and the UK that companies of Yamana Gold’s size and nature continued to choose the London Stock Exchange over others.

Looking forward

We have welcomed the review by Lord Hill into the UK listing regime and see it as a chance to shape the future of the UK. Industry experts have been asked to provide evidence and views around dual class share structures and dual and secondary listings, as well as free float requirements, track record requirements and prospectuses.

In our opinion, London’s dual-listing infrastructure is one of the UK’s greatest assets and has been extremely popular for years, not least because of the capital’s reputable regulatory environment and the fact that it offers the deepest pools of capital in Europe, allowing companies to fundraise with ease. It is in everyone’s interests that these companies and their investors continue to have free access to the London Stock Exchange and benefit from the very best infrastructure the UK can provide.

Of course, there are concerns around Brexit. But, in reality, the markets have had four years of warning and quantitative easing, as well as preferable interest rates, which have created a hospitable environment for markets to thrive in 2021.

The positive conversations, strong pipelines and bullish brokers we’re currently seeing leaves us feeling extremely positive about the year ahead.