British fintech Wise seeks direct listing in London

Wise, a digital-payments company, said it plans to float on the London Stock Exchange via a rare direct listing, bolstering the U.K. in its ambition to expand as a tech hub, Reuters reports.

The company is also giving its founders and employees extra voting rights for their shares for a limited time, allowing them to retain control after Wise goes public, it said in a statement Thursday.

While direct listings are uncommon in London, they have gained traction with hot technology startups in the U.S.

The likes of cryptocurrency exchange Coinbase Global Inc. and website-hosting service Squarespace Inc. took this route to public markets in New York this year.

In a direct listing, a company doesn’t raise fresh capital and existing investors can sell shares directly on the open market, without the usual lockup period restrictions in a traditional initial public offering.

It also saves on underwriting fees paid to bankers and the time spent on a bookbuilding process.

A reference price is assigned to the stock before trading begins rather than one being determined by investor demand.

Wise’s float is a big win for the U.K., which wants to attract more listings from high-growth companies in the technology sector. London is working hard to maintain its position as a major financial center in a post-Brexit world.-Photo: Wise/Sky News