Ashtead Group to leave London Stock Exchange for U.S. in another blow to U.K.'s main market

MW Ashtead Group to leave London Stock Exchange for U.S. in another blow to U.K.'s main market

By Louis Goss

Industrial equipment rental company Ashtead Group has announced plans to switch its primary listing from the London Stock Exchange to New York, in another major blow to the U.K.'s main stock market.

In a statement on Tuesday, the FTSE-100 index constituent company said it had "concluded that the U.S. market is the natural long-term listing venue" for its business which now generates "almost all" of its profits in the U.S.

Ashtead Group was first started as a tool rental company in the tiny village of Ashtead, Surrey in the south of England in 1947 before launching an initial public offering on the London Stock Exchange in 1986, and acquiring its U.S. subsidiary Sunbelt Rentals in 1990.

Explaining its decision to switch, Ashtead noted that in the financial year 2024 it generated 98% of its $2.65 billion in operating profit from its operations in North America, where its management team and the majority of its staff also work.

Shares in Ashtead Group (UK:AHT) fell 10% on Tuesday having advanced by 11% over the previous 12 months.

Ashtead Group, which first joined the FTSE-100 index UK:UKX in 1990, said moving its listing to the U.S. would also increase exposure to investors, while at the same time boosting its profile in its main market in line with plans that will see the firm rebrand as Sunbelt Rentals.

The London listed company, which loans out equipment including diggers, construction tools, and film cameras, said switching to a U.S. listing would also increase the liquidity of its stock and allow for its inclusion in "premier U.S. equity indices"

Ashtead Group said it plans to retain a secondary listing on the London Stock Exchange's International Companies segment and the company said it now plans to let shareholders vote on the move with a view to switching its primary listing to the U.S. over the next 12 to 18 months.

The FTSE-100 company's decision to exit the London Stock Exchange comes as another hit to the U.K.'s bourse in the wake of a series of high-profile departures including Paddy Power parent company Flutter Entertainment $(FLUT)$ and German travel agent Tui (XE:TUI1).

Record inflows into U.S. exchange traded funds (ETFs) in 2024 have increased the attractiveness of New York listings over the previous year.

-Louis Goss

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December 10, 2024 04:25 ET (09:25 GMT)

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