The attraction of an NYSE listing may be under increasing pressure, according ($sub req’d) to the Financial Times.
Concerns about litigation are cited in a new survey that points to a rise in the international nature of capital markets. London and Hong Kong are cited as growing at the expense of the NYSE:
Nearly 60 per cent of respondents to the survey of attorneys specialising in initial public offerings said the risk of securities litigation, coupled with the cost of developing infrastructure for a public company and meeting accounting standards, discouraged companies from going public in the US, according to Gavin Anderson, the US financial communications company. Richard Truesdell, of Davis Polk and Wardwell, said that, while US exchanges continued to capture a strong share of international offerings, their position was at risk.
â€œOverseas markets have developed attractive regulatory frameworks and they are getting better at marketing and providing liquidity to support IPOs,â€ he said.
The Gavin Anderson firm interviewed attorneys from 20 US firms representing issuers on almost $11 billion of US IPOs last year.
While it is true that law firms can benefit from the work created by increased regulation (like Sarbanes-Oxley), this survey shows that long-term it may be more of a mixed blessing if more securities work is headed offshore.
The NYSE, of course, is not sitting still, the parent company is now called NYSE Euronext.