London move not about Brexit — Brait
BRAIT’s plans to seek a listing in London were not driven by the Brexit vote or the subsequent negotiations, the investment holding company said on Thursday.
The move, proposed to shareholders on Wednesday, would see Brait moving its registered office from Malta to the UK. Its secondary listing on the JSE would not be affected.
Brait would still be subject to EU company laws, allowing further transfers of its registered office to other European Economic Area countries without having to dissolve the company. It can also convert to a UK public limited company.
This has given Brait the option of staying in the eurozone or executing its own Brexit.
But a spokesman, responding to questions directed at CEO John Gnodde, said the transfer was a “preparatory move” for a premium listing on the London Stock Exchange and an inclusion in the FTSE UK index series, which had nothing to do with Britain’s vote to leave the EU.
“Across its portfolio companies, the UK is the largest market in which Brait is invested,” said the spokesman.
UK retailer New Look and fitness chain Virgin Active accounted for 68% of Brait’s net asset value by its March financial year end.
“We consider that a premium listing in London and inclusion in the UK FTSE index series, if achieved, would enhance the profile of Brait, improve the liquidity of dealings in its shares and improve its access to a wider range of international investors,” said the spokesman.
Brait would not answer questions about its continued access to the European Economic Area. But its share price has come under severe pressure in the run-up to the Brexit vote, plunging 27.7% from the end of May to the present.
An analyst, who declined to be named in line with company policy, said he did not think Brait’s decision had “much to do with Brexit and its fallout”.
“Frankly, I don’t think it matters that much to them,” he said. “We believe that about 70% of Brait’s value is situated in the UK. It makes a lot of sense for it to be based in the UK. We do not think Europe is much of a priority to Brait.”
The analyst was unsure what Brait’s move meant for its access to the EU.