Online takeaway service Just Eat could become the first company to list on the London Stock Exchange’s newest market, after it announced it was considering the High Growth Segment for its upcoming floatation.
The High Growth Segment, launched last March as a new segment on the Main Market, allows fast-growing companies to list shares and raise money while retaining 90 percent of the equity. It is designed to be an IPO launchpad for booming companies – many of them in the technology sector – that are too big for the Alternative Investment Market (AIM) but are not yet ready for a premium listing, which would require them to give up 25 percent of the company.
Despite being live for roughly a year, tech companies have shunned the High Growth Segment up until now, with many, including Candy Crush creator, King, abandoning London completely and choosing to list in New York instead, where some argue there is more capital available, an abundance of technology analysts and a better overall ecosystem.
Just Eat, which is seeking £100 million in a floatation that could value the group at close to £1 billion, has yet to decide whether it will list on the High Growth Segment or London’s Premium market. The decision will be largely driven by the shareholders who will need to decide how much stock they are willing to part with.
Just Eat chief executive David Buttress was unavailable for comment but a Just Eat spokesperson said the company feels “comfortable” with the High Growth Segment, despite its unproven track record, adding that it’s a “great opportunity”.
Joanna Shield, the chairman of Tech City UK who helped to create the High Growth Segment, told Techworld: “The unique optionality of London’s markets supports the growth of firms from SME to FTSE100."
"This is the second listing to come from the Future Fifty programme and further evidence that the UK is home to an emerging set of world-class growth stage technology companies," she added.