There is no disguising the fact that the loss of the primary listing of Ashtead to New York will be a big blow.
The equipment-hire group, listed in London since 1986, has quietly achieved a handsome valuation of £24billion by establishing a record of expansion.
Since Ashtead acquired Sunbelt Rentals in 1990, adding to it several other US buys, it has looked across the Atlantic for growth and this year projects 98 per cent of its operating profits will come from there.
Nevertheless, its desertion for America is a bad precedent. Ashtead may seem an exception in that so much of its profits come from across the Atlantic.
But there are many other companies quoted in London – notably big natural resources groups such as Rio Tinto, Anglo American and Glencore – which could say the same.
The hire group argues that a Wall Street listing will provide increased exposure to US investors and improve the liquidity of its shares.
US bound: Equipment-hire group Ashtead, which listed in London since 1986, has quietly achieved a handsome valuation of £24bn by establishing a record of expansion
There is truth to this. UK investors, particularly the pension funds, share most of the blame.
British taxpayers get a generous tax subsidy for putting cash into pensions. UK retirement savings at £1.12 trillion are the third largest in the world.
Unfortunately, fund managers too often choose the S&P 500 over FTSE 350. If Chancellor Rachel Reeves could bulldoze through promised reforms, it would be simpler to direct Britain’s savings towards growth companies and infrastructure.
Ashtead’s press release omits an important factor behind its move. The US offers senior executives the possibility of rewards beyond the dreams of avarice. It has a wholly different, more positive approach to wealth and pay than Britain.
Attitudes in the UK towards enterprise are not helped when the Government yacks on endlessly about working people.
That doesn’t mean it is all over for UK plc. The expected arrival of creative group Canal+ to London is an important gain for the creative sector.
The long list of Golden Globe nominees is testimony to strength in depth. It is appalling that creative firms, such as ITV, are not valued as they should be given the nation’s production strength.
Other listings, such as Singapore-based fast-fashion group Shein, are on their way. With the right encouragement, the pipeline would include De Beers and Unilever’s ice cream division. Britain also should be fighting to keep online banking group Revolut in London.
Landing the biggest fish and keeping Shell and Rio anchored here will only happen if our pensions managers embrace the domestic market. They need to commit to tripling or quadrupling the allocation of funds to great British equities.
Water slide
Any rescue for Thames Water should be rooted in the private sector.
Chief executive Chris Weston is wrong to suggest that the break-up, suggested by would-be bidders Covalis Capital and Suez, would be a distraction.
Hiving off businesses demonstrably has improved the performance of publicly quoted companies such as pharma group GSK.
Admittedly Thames, with its terrible sewage record and a £16billion debt mountain, is in a ghastly state.
Separating upstream Thames Valley customers from London would make the scale of the problems more manageable.
A substantial price increase will be required if the necessary investment in better pipes, runaways and combating pollution can take place.
But consumers should never be asked to pay for financial engineering, ever bigger rewards for sub-octane executives and distributions to investors in far-off tax havens.
Brighter note…
Sharon White has kept her peace since stepping down as chairman of John Lewis.
The former senior civil servant and regulator struck a note of disappointment over Labour’s gloomy tone when she appeared before City grandees and publishers at the FT’s Business Book of the Year ceremony at the spectacular Peninsula Hotel in the heart of London. The venue is a tribute to international investment in the UK.
White demanded optimism and urged action on Oxford-Cambridge links, changes to higher education, a more professional approach to competition and reform of post-privatisation regulators.
The work of AI pioneers chronicled in the winning book Supremacy: AI, Chat GPT And The Race That Will Change The World by Parmy Olson will have a big role to play.
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