CRHThe Irish Stock Exchange (ISEQ) was dealt a serious blow with the news that CRH has announced that it’s moving the company’s primary listing to London’s FTSE. The move is part of CRH’s strategy to increase its exposure to international institutional investors.
As the single largest quoted member of the Irish Stock Exchange with a weighting of 23%, CRH represents nearly 25% of the ISEQ and the move has been seen as a dramatic development on this side of the Irish Sea.
Although the move has been downplayed by the ISEQ, losing CRH has serious implications for the Irish stock market’s ability to retain companies with significant capitalization.
CRH is a Dublin-based building-materials giant, with a market value of €9.3bn.
Myles Lee, CEO of the company said that as and from December 6th this year, CRH shares will be reclassified to secondary listed on the ISEQ’s main securities market.
It is expected that CRH will also join the FTSE-100 index on December 19 and with immediate effect euro-denominated shares listed in London will be quoted in sterling.
Lee added that the move was in the company’s “best long-term interests" by allowing it to appeal to a much wider international investor base. He went on to say that the majority of trading in its stock already takes place in London due to the international nature of CRH's business.
To qualify for membership of the FTSE-100 a quoted company must have its primary listing on the London Stock Exchange. Currently approximately 55% of CRH's stock is traded in London and about 20% in Dublin.
The Irish Stock Exchange is owned by its member firms so the downgrading of CRH’s listing is indeed a serious and some would say challenging blow, considering the uncertainty surrounding the European debt crisis and its negatively on sentiment.
