- Shell’s CEO calls the London Stock Exchange “undervalued” and less competitive compared to Wall Street.
- The company is considering “all options” if the valuation gap persists.
- A potential exit by Shell would be a significant blow to the London Stock Exchange.
Shell’s chief executive has floated the possibility of the petrogiant abandoning its “undervalued” London listing.
Wael Sawan, who runs the largest company on the FTSE 100, said the embattled London exchange was an “undervalued location” as he joined a raft of global CEOs in complaining about the capital’s equity markets.
Shell, he said, was a “fantastic” investment opportunity due to its undervaluation in the interview with Bloomberg.
“I will keep buying back those shares, and buying back those shares at a discount,” he added.
Sawan is set to embark on a so-called ‘sprint’ to improve the firm’s competitiveness and profit-making.
The firm is undervalued compared to peers listed on Wall Street.
“If we work through the sprint, and we are doing what we are doing, and we still don’t see that the gap is closing, we have to look at all options.”
An exit by Shell would be a bruising and almost terminal blow for the London Stock Exchange after a torrid year in which new IPOs have dried up and a string of firms have scrapped their listings for New York.
Just 23 companies listed in London last year, raising around £1bn, the lowest level since just after the financial crisis, according to data from EY.
The move by the British chipmaker Arm to float in New York despite a major charm offensive by ministers and regulators was also seen as a major snub for the City.
The Treasury and regulators have been on the offensive to try and boost the appeal of the London Stock Exchange by overhauling listing rules and directing more capital into the market from retail investors and pension fund.
By CityAM
