Chinese Businesses urged to follow Isle of Man route to London Listing
Chinese companies seeking an effective platform for raising money via a public listing in London, were urged to look at the advantages of incorporation in the Isle of Man.
The invitation was made by Daniel Mackelden, Head of Cains' London office, during a visit to Shanghai and Beijing, where he was accompanied by Andrew Baker, a senior Isle of Man based colleague.
The two Cains lawyers were in the Peoples Republic of China to address a Beijing Conference hosted by Zhonglun W&D Law Firm, as well as to meet a number of leading Chinese and Western law firms to discuss UK listing & Isle of Man incorporation as a cost and tax efficient structure for international expansion and fund raising.
As a leading law firm with key experience in advising international companies on a UK listing coupled with Isle of Man incorporation - having completed more than 14 such listings in the last year alone - Cains are well placed to comment and advise fast growth corporates in China on the utilisation of this structure.
Speaking at the Conference: Daniel Mackelden said: "The eyes of the world are focused on China's emergence as a global economic superpower. The UK's welcoming regulatory environment and the cost effectiveness of a London Listing makes it an enticing destination for Chinese corporates looking to go public and expand their businesses overseas.
"Against this background, Chinese firms should not underestimate the commercial benefits of incorporation in the Isle of Man, located within easy reach of the UK, where its corporate structure, advantageous tax regime and corporate services expertise offers global business an unbeatable package for offshore incorporation."
The Isle of Man has now become the most preferred offshore jurisdiction for major companies listing on London’s junior market, AIM; recent research by Hemscott, the global business data provider, which examined the top 100 companies listed on AIM, revealed that 15 non-UK "AIM 100" companies are incorporated in the Isle of Man with a market capitalisation of £5.222 billion. Cains advised on the vast majority of these transactions.
As a location, the UK is already established as a key gateway for globalising Chinese firms seeking a platform from which to sell their products and services throughout Europe and the Middle East. This status, combined with the strength and size of the Chinese community already established in the UK, has seen London attract the largest share (15 per cent) of all Chinese Foreign Direct Investment into Europe since 2002.
This trend is reflected by the appetite of Chinese firms to access the depth and breadth of London's capital markets funds, a drive which has led to the current listing of 45 companies on AIM, with a combined market capitalisation of approximately £2.8 billion.
AIM was created in 1995 by the London Stock Exchange as an international market for smaller, growing companies and currently has 1,644 listed businesses. The total market capitalisation of Isle of Man companies listed on AIM is £7,478 billion.
Commenting on Cains’ role in assisting Chinese firms expanding overseas, Andrew Baker of Cains said: “Cains is ideally placed to help Chinese firms achieve their fund raising aims. Our professional mix of London-trained and specialist international lawyers puts us in the perfect position to help our global clients.
The quality of international companies who have already put their faith in us reflects their belief that we are the listing experts who can really make things happen for them. We're proud of our strong track record in effecting successful international transactions for our clients.”
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