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City trader snubs London Stock Exchange for New York listing

london stock exchange
london stock exchange

A member of the London Metal Exchange has decided to list in the US rather than Britain in yet another blow to the beleaguered stock market.

Marex has submitted preliminary documents with the US Securities and Exchange Commission for an initial public offering (IPO), two years after abandoning plans to list in London.

The company ditched a London Stock Exchange IPO in 2021, citing difficult market conditions. At the time, the listing would have valued the group at about £500m.

Marex’s decision to turn to New York rather than revive plans to list in London delivers another dent to the reputation of Britain’s financial centre.

Executives and policymakers have been grappling with a slow decline of the UK equity market, with companies snubbing the London Stock Exchange for New York or Amsterdam.

Cambridge-headquartered chipmaker Arm opted for a Nasdaq listing instead of London when it listed earlier this year and companies including Ferguson, Tui, CRH and Flutter Entertainment are all either moving their listings away from London or seeking secondary listings elsewhere.

Flutter, which owns gambling brands including Paddy Power, confirmed on Friday it was hoping to list its shares in New York by the end of January, though it will maintain its London listing for now.

arm listing nasdaq
Cambridge-headquartered chipmaker Arm opted for a Nasdaq listing instead of London when it listed earlier this year - BRENDAN MCDERMID/REUTERS

Companies are attracted to the US by the higher values investors tend to put on new listings, increased liquidity offered by the market, and higher pay and bonuses for executives.

Marex is seeking a valuation far higher than what it was targeting in London. It is hoping to be valued at up to $2.8bn (£2.2bn), according to the Financial Times.

No more details have been released but an IPO is likely to take place next year after the SEC reviews the proposal.

Founded in 2005, Marex offers a range of trading and brokerage services to clients including banks and hedge funds. It is a primary member of the historic London Metal Exchange, allowing staff to trade in the open outcry “ring” market.

Marex has 1,600 employees around the world, with 29 offices spanning the US, UK, Europe and Asia. Revenues rose 21pc last year to reach $1.34bn and the business made a pre-tax profit of $121.6m.

The company has shifted to become more US-focused since it abandoned plans to list in London. It bought EDF Man’s capital markets unit for $220m, which gave it greater exposure to the American market.

Marex is majority-owned by private equity firm JRJ Group, which was set up by former Lehman Brothers bankers Jeremy Isaacs and Roger Nagioff.

The private equity group invested in Marex in 2010 and has seen it grow through a string of acquisitions over the past 13 years.

JRJ is expected to receive a significant windfall when the group lists.

Marex is led by chief executive Ian Lowitt and chaired by former banker Robert Pickering.