Unlock the Editor’s Digest for free
Roula Khalaf, Editor of the FT, selects her favourite stories in this weekly newsletter.
Shawbrook’s private equity owners are considering a sale of the lender or a London listing at a target valuation of £2bn, marking a glimmer of optimism in the UK capital after a bad year for its main stock market.
BC Partners and Pollen Street Capital, which bought the UK small business lender in 2017, are close to appointing Goldman Sachs to oversee an initial public offering, according to two people familiar with the matter, as the firms pursue a “dual track” approach to an exit from their investment.
They added that should a listing proceed, the aim would be for it to take place in the first half of this year.
Barclays could also be appointed to advise on a listing, the people added, cautioning that the IPO plan depended on market conditions and the exit plans may ultimately not go ahead.
The new plans for an IPO, initially reported by Sky News, offer a small glint of positivity to the London Stock Exchange, which last year suffered its biggest net outflow of companies since the global financial crisis.
A total of 88 businesses delisted or transferred their primary listings from the LSE last year, with just 18 taking their place, against a backdrop of poor performance and declining liquidity.
Performance on the FTSE 100 has been mostly flat since the Brexit referendum in 2016, while big names from diverse sectors have in the past 18 months moved their main listings to New York or announced plans to do so.
The latest blow to the UK stock market was delivered in December, when construction equipment rental group Ashtead revealed plans to move its listing from London to New York.
BC Partners and Pollen Street were close to selling or listing Shawbrook, which specialises in lending to small and medium-sized businesses, in 2022 but shelved the plans after the challenger bank’s key customers were hit by inflation and soaring energy costs.
Shawbrook was launched in 2011 when Pollen Street, which at the time was part of Royal Bank of Scotland, bought Whiteaway Laidlaw Bank, which was then rebranded as Shawbrook.
Shawbrook was not immediately available to respond to a request for comment. BC Partners and Pollen Street declined to comment.
Read the full article here