The U.K. is stepping up efforts to attract more African companies to the London Stock Exchange (LSE), with officials pitching London as the go-to destination for raising global capital.
Why it matters
More than 100 African companies raised over £17 billion on the LSE in the decade to 2020, but competition from U.S. exchanges like Nasdaq and the NYSE is intensifying. London wants to remain the preferred listing venue outside the continent.
Recent moves
- High-profile deals: Africa Finance Corporation listed a $500 million eurobond in March, while Guaranty Trust Holding Company (GTCO) raised $100 million in an IPO last month — becoming the first Nigerian bank owner to go public in London.
- Pipeline building: The U.K.’s Department for Business and Trade (DBT) has spent nearly four years courting African firms, holding forums with private equity and venture capital investors to highlight London’s advantages.
- New rules: Revised listing requirements — such as lowering the equity stake companies must give up to list — are part of the U.K.’s pitch.
Zoom in
- DBT has mostly targeted pan-African and tech firms, with strong interest in AI, biotech, and clean tech.
- North Africa, particularly Tunisia, is seen as a hotspot for AI and deep-tech ventures thanks to strong engineering talent.
- Ghana, Tanzania, Nigeria, and South Africa are also producing promising companies.
The big picture
- London has hosted African listings like Helios Towers and Airtel Africa in recent years.
- The NYSE and Nasdaq, however, remain bigger by market capitalization — six to eight times larger than the LSE — and have drawn African names like Jumia (2019) and IHS Towers (2021).
- Still, London leads in total African IPOs outside the continent, partly thanks to analysts and brokers who specialize in African equities.
Step back:
- The LSE’s Alternative Investment Market (AIM) has been the most accessible entry point for African firms since its creation three decades ago.
- Companies typically spend about three years preparing for a London listing.
- Nigeria’s GTCO currently ranks second on the FTSE UK Listed Africa Index, which tracks the performance of African firms across the exchange.
Source: Semafor
