British law firms fail to cash in on Easdaq listings work

UK law firms are losing out on valuable work preparing companies for listing on Easdaq, the new European electronic stock exchange, according to a leading UK stock broker in the market.

Nick Rogers, corporate finance director at Beeson Gregory which has shares in Easdaq, was speaking to The Lawyer after UK company Esprit Telecom Group listed jointly on Easdaq and Nasdaq, raising around $57m.

The listing rules for Easdaq, which was launched in December 1996, are modelled on those of Nasdaq, the highly successful computer-based trading exchange set up in the US which trades largely in shares of US-based hi-tech companies.

Many of the companies seeking a listing on Easdaq are, like Esprit, doing a dual listing on the more mature Nasdaq market.

Rogers said: “Most UK law firms are not set up to do the level of notification a Nasdaq listing requires.” The global offerings tended to be led by US houses, he said, which often instructed the firms they knew: the US firms.

The arranging of Esprit's global offering was led by US house Lehman Brothers, which instructed US firm Simpson Thacher & Bartlett, while US law firm Shearman & Sterling did the bulk of the work for Esprit. In the UK Esprit instructed Rowe & Maw. Beeson Gregory acted as sponsor for the European component of the flotation and was advised by Travers Smith Braithwaite.

There are now seven companies listed on Easdaq – which has a total market capitalisation of $1.4bn – but many more are in discussion about floating. Easdaq said 47 per cent of those applying are either British, French or American and the majority are large companies with a market capitalisation of $50m to $150m.