Azernews.Az

By Alimat Aliyeva

Since the beginning of 2024, the number of companies whose shares are traded on the London Stock Exchange (LSE) has declined at a record pace, the fastest in over a decade. This has been largely due to their takeover by larger competitors and investment firms, Azernews reports.

Around 45 companies have left the London Stock Exchange this year, the highest number since 2010. Meanwhile, only 11 companies conducted initial public offerings (IPOs) on the LSE. The volume of transactions involving the purchase of British firms surged by 81% year-on-year, reaching over $160 billion.

Foreign investment firms have been particularly active in acquiring UK-based companies. For example, in October, the American Starwood Capital Group purchased the London-based Balanced Commercial Property Trust Ltd. for £674 million ($852 million). The Swedish firm EQT AB recently completed the acquisition of the gaming studio Keywords Studios Plc for £2.1 billion, and Thoma Bravo finalized the purchase of cybersecurity software company Darktrace Plc for $5.3 billion.

Additional deals may be announced before the end of the year. Notably, Aviva Plc is still working to acquire the insurance company Direct Line Insurance Group Plc for £3.3 billion, while General Atlantic is in talks to purchase Learning Technologies Group Plc, a UK-based online education company with a market capitalization of £730 million.

This trend reflects the growing attractiveness of UK-listed companies among investors. The British stock market is currently trading at a discount of more than 40% compared to competing global platforms, according to Bloomberg.

In addition to being undervalued, the UK market's relative openness and regulatory flexibility continue to make it an attractive target for foreign investors seeking opportunities. The ongoing consolidation within the LSE highlights the strategic importance of the UK market, which continues to serve as a key gateway for global investment. As companies exit the exchange, they are often replaced by large-scale deals that reshuffle the ownership landscape in favor of major international players. This could also signal a potential shift in the types of companies remaining on the LSE in the future, focusing more on those with significant global market influence.