The unlisted securities venue operator JP Jenkins – the largest in the UK – has announced that the FCA has awarded it a PISCES operator license, making it the second provider in this sphere.
That follows on from the London Stock Exchange receiving its approvals in August. PISCES – the Private Intermittent Securities and Capital Exchange System – has grown out of the realisation by policy makers that the dearth of IPOs in recent years means successful growth companies are staying private for longer, so the thinking goes that by formalising a process for trading these shares, liquidity can be unlocked and in turn, capital recycled.
This solution is arguably of the greatest interest to existing asset owners, or those early-stage investors and employees who are holding shares in stock that isn’t traded on a traditional public market. That’s because PISCES offers a regulated and formalised framework for transferring ownership between buyers and sellers. And whilst liquidity will inevitably be somewhat thinner than is seen in legacy markets, the ethos is that it’s very much a step in the right direction – an improvement on the current state of affairs.
Mike McCudden, CEO of JP Jenkins, commented: “We are delighted to have now achieved this significant milestone both for ourselves and the broader UK capital market”, adding that the business was genuinely excited when it comes to the prospects this holds for both companies and investors alike.
The innovation won’t however mean a flood of new stocks becoming available for anyone to trade. Whilst any holder will be able to place a sell order, the intention is that these securities, owing to the expected lack of liquidity, lower levels of disclosure and risk profiles will only be available for sophisticated investors or institutions to buy. It does however offer a liquidity route for those with stranded equity as well as presenting interesting opportunities for funds looking to get exposure to specific companies or sectors.
Whilst not all PISCES issuers are expected to go on to a traditional IPO, the belief is that some will, so perhaps this move also helps stem the flood of exciting, early-stage British businesses being snapped up by overseas rivals. There’s a lot to fix in the London market and this won’t do it all – but it surely feels like a step in the right direction?
Richard is the founder of the Good Money Guide (formerly Good Broker Guide), one of the original investment comparison sites established in 2015. With a career spanning two decades as a broker, he brings extensive expertise and knowledge to the financial landscape.
Having worked as a broker at Investors Intelligence and a multi-asset derivatives broker at MF Global (Man Financial), Richard has acquired substantial experience in the industry. His career began as a private client stockbroker at Walker Crips and Phillip Securities (now King and Shaxson), following internships on the NYMEX oil trading floor in New York and London IPE in 2001 and 2000.
Richard’s contributions and expertise have been recognized by respected publications such as The Sunday Times, BusinessInsider, Yahoo Finance, BusinessNews.org.uk, Master Investor, Wealth Briefing, iNews, and The FT, among many others.
Under Richard’s leadership, the Good Money Guide has evolved into a valuable destination for comprehensive information and expert guidance, specialising in trading, investment, and currency exchange. His commitment to delivering high-quality insights has solidified the Good Money Guide’s standing as a well-respected resource for both customers and industry colleagues.
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