Britain’s financial regulator has given the green light for the launch of a new private share trading platform, known as the Private Intermittent Securities and Capital Exchange System (PISCES). This platform is designed to enable trading of shares in private companies, providing a new avenue for investors to access exciting growth companies.
What is PISCES?
PISCES aims to connect owners of fledgling unlisted companies with new investors, allowing them to sell shares in their businesses and facilitating growth and scaling up. The platform will enable company owners to offer stock for sale at regular intervals, at prices they set, to new shareholders.
Benefits of PISCES
- Increased Access: PISCES will give investors greater access and confidence to invest in exciting new companies.
- Flexibility: Early backers and employees can sell up and invest again, providing liquidity and flexibility.
- Growth: PISCES will support economic growth by boosting UK capital markets.
How Will PISCES Work?
- Sandbox Approach: The first shares will be traded on the platform this year through a “sandbox” approach, allowing regulators to test how it works before finalising a permanent regime in 2030.
- FCA Approval: Operators, such as the London Stock Exchange, will need to apply to the Financial Conduct Authority (FCA) to run a PISCES platform.
- Intermittent Trading Events: Approved operators will be able to run intermittent trading events.
Industry Feedback
While PISCES has been welcomed by some, others in the UK industry have expressed concerns. Bankers fear hits to revenues and being bypassed in a booming market for private capital. Jack Shepherd, a partner with law firm CMS, notes that PISCES is an innovative attempt to revive the UK’s capital markets but questions whether it addresses a genuine problem without cannibalising companies that might otherwise seek a listing on the Main Market or AIM.
FCA’s Response to Feedback
- The FCA has taken steps to address industry concerns, including
- 25% Threshold: Applying a 25% threshold for identifying major shareholders.
- Reduced Disclosure Requirements: Reducing disclosure requirements for PISCES operators and companies.
- Greater Say for Companies: Giving companies greater say over who can invest in them.
The launch of PISCES marks an exciting development in the UK’s capital markets. By providing a new platform for private companies to access investors, PISCES has the potential to drive growth and innovation. As the platform begins trading this year, it will be interesting to see how it evolves and impacts the UK’s financial landscape.
