Low-cost airline Ryanair on Friday announced plans to withdraw from the London Stock Exchange after announcing its plan earlier this month amid Brexit and lower trading volumes.
It is the first large company to blame its departure on Brexit. Regulations now prevent non-EU investors from owning more than 49% of the airlines registered in the bloc.
This decision will reinforce the importance of Ryanair’s main listing in Dublin.
Ryanair previously said the rules made a general migration away from London for EU companies more acute in its case. In addition to its Iseq listing, Ryanair’s U.S. certificates of deposit are traded on the New York Nasdaq.
Ryanair’s chief financial officer, Neil Sorahan, noted during a presentation of the company’s interim results in recent weeks that less than 10 percent of its shares are traded in London.
He said Ryanair would seek shareholder input before reporting to the board, which would decide on the decision.
Even after taking several steps to limit ownership outside the EU, just over a third of Ryanair’s shares are held by EU member states, chief executive Michael O’Leary told Bloomberg TV earlier this month.
He then said the carrier should take further steps to bring the total to over 50 percent. “It is an inevitable consequence of Brexit,” he said. “We need to own and control the EU, and delisting from London is a relatively small initiative in this strategy.”
Ryanair’s directors on Friday announced their intention to ask the UK’s Financial Conduct Authority (FCA) to cancel the standard listing of the company’s ordinary shares on the FCA’s official list.
He also asked the London Stock Exchange to cancel the admission to trading of the shares on the main market for listed securities of the London Stock Exchange.
“As indicated in our interim results, and following subsequent shareholder engagement, Ryanair has decided to request cancellation of the London listing,” the group told investors in a note to Euronext Dublin.
He said the decision was made “because the volume of trading in shares on the London Stock Exchange does not justify the costs associated with such listing and admission to trading.”
He further added that the decision was taken “in order to consolidate the liquidity of trading on a regulated market for the benefit of all shareholders”.
The company is required to give at least 20 working days’ notice of the proposed cancellation of registration. Therefore, it is expected that the cancellation of the London listing will take effect on December 20 at 8 a.m. so that the last day of trading for shares on the London Stock Exchange would be December 17.
Following the cancellation of the London listing, the company will continue to have a main listing on the regulated market of Euronext Dublin, which offers shareholders “the highest level of protection, including compliance with the UK corporate governance code. company ”.
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