City figures launch initiative to encourage more Chinese firms to list in London by addressing corporate governance issues

 
William Turvill
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The group estimates that 110 Chinese companies have listed in London in the last 20 years (Source: Getty)

A group of City firms and business leaders have today launched an initiative to encourage more Chinese companies to list on London markets by healing corporate governance issues.

Led by China Resolutions chairman John McLean, the group is also aiming to grow international fund investment into Chinese companies and improve the international standing of the companies in terms of corporate governance.

The group believes the experience of Chinese companies listing in the UK has, to date, been unsuccessful, leaving a “bad taste” in the mouths of all parties.

Between 1997 and 2016, there were estimated to have been 110 Chinese listings in London, raising £1.7bn. At their initial public offering (IPO) prices, the companies had a combined market capitalisation of £6.2bn. As at the end of July this year, that figure had fallen to £3.3bn, with 75 companies having delisted.

The group is particularly keen to promote the UK as a listing destination after Brexit.

The China City Group initiative was established by McLean, who has worked in and with the Asian nation since 1998, and Tim Clissold, a business writer and author of “Mr China”. They are backed by law firm CMS and Zhonglun, accountancy firm Moore Stephens, the China-Britain Business Council, the Great Britain China Centre and 20 other City and business professionals.

McLean said: “I genuinely believe that we can achieve momentum rapidly and that our shared vision will bring benefits for both China and the UK.

“I want London to continue to be the centre of international capital markets, and if we do not do something, this accumulated China-related expertise and knowledge will disappear from London.

“What we are suggesting are practical steps to ensure that the UK has reasons to be confident in the ‘China Brand’.”

Read more: Lending to China surges as banks shrug off fears of a debt bubble

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