London’s public markets –

a gateway to international capital

British Embassy in Madrid

May 2014

2

Our issuers operate in more than 115 different

countries across the globe

Source: London Stock Exchange statistics. Based on country of primary business.

60 +

40-59

20-39

1-19

Number of companies

3

London is home to companies from across Europe

Source: London Stock Exchange statistics. Based on country of primary business.

Number of

companies

Examples of Listings

Western

Europe

63

AIM - 37

Main Market – 26

Southern

Europe

24

AIM - 13

Main Market – 11

Israel 17

AIM - 12

Main Market – 5

Eastern

Europe

45

AIM - 25

Main Market – 20

Ireland 60

AIM - 32

Main Market – 28

3

4 Source: Dealogic, WFE, as of January 2014

*%Price Offer//Current - performance is market-cap weighted

**Transaction value - USD(m)

London is the leading market in EMEA

Number of IPOs

Money raised through IPOs (USDm)

Daily traded value** and number of transactions

Post-IPO performance* by Exchange

835

662

411

288

0

2,000

4,000

6,000

8,000

10,000

LSEG NYSE Eur EU Deutsche Börse Nasdaq OMX

No. of transactions (000s)

0

20

40

60

80

100

120

LSEG NYSE Eur EU NASDAQ OMX DB NYSE EurAmsterdam

0

5,000

10,000

15,000

20,000

25,000

LSEG NYSE Eur EU DB NASDAQ OMX NYSE EurAmsterdam

NA

-6.3

24.8

32.8

33.2

-10.0 0.0 10.0 20.0 30.0 40.0

NYSE EurAmsterdam

DB

NYSE Eur EU

NASDAQ OMX

LSEG

5

Money

raised (IPO)

(USD m)

Jan-Apr

2013

Jan-Apr

2014

%

change

Main Market 2,989 9,788 227%

AIM 83 2,353 2735%

Total 3,072 12,141 295%

Follow on

issues

(USD m)

Jan-Apr

2013

Jan-Apr

2014

%

change

Main

Market 7,467 18,502 148%

AIM 1,030 2,079 102%

Total 8,497 20,581 142%

Number of

IPOs

Jan-Apr

2013

Jan-Apr

2014

%

change

Main Market 9 22 144%

AIM 10 25 150%

Total 19 47 147%

Source: Bloomberg and Dealogic, as of 30 April 2014

Jan-Apr refers to the period January 1st 2014 – April 30th 2014

0

10

20

30

40

50

60

0

5

10

15

20

25

30

35

40

45

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1

2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

VF

TS

E

Dea

l va

lue

in

GB

Pb

n

Further issues New issues VFTSE

London new issuance market extremely active…

6

Start - Up Early Stage Expansion Consolidation &

further capital raising

Diversification of investors, M&A

and International Expansion

EU Regulated

Concept &

seed stage

Fu

nd

ing

re

qu

ire

me

nt

£500k

£1m

£100k

£50k

£150m

£1bn

Not public Exchange regulated Market

designation

Strategic consideration

Official List & EU Regulated

A choice of routes to market to cater for all

sizes, strategies and development stages

7

Equity AUM held in international portfolios, by exchange Q1 2014*

Source: Facset and LSE calculation

*international portfolios defined as investment in companies different to the country of domicile of the portfolio manager

Top institutional investors holdings

by country (as at end Q1)

London

Hong Kong

US

Regions with

increased exposure

compared to previous

quarter are in green,

and decreased in red,

unchanged in black

4%

2%

3%

-1% 4%

-2% 2% -8% 2%

-2%

-

200

400

600

800

1,000

1,200

LSE NYSE NASDAQ HKSE NYSEENXT Paris

ASX NYSEENXT Ams

Bovespa TSX SGX

US

Db

n (

% c

ha

ng

e t

o Q

4 2

013)

UK 43%

EMEA (ex-UK)

16%

North America

28%

Asia Pacific 11%

Lat America

2%

UK 4%

EMEA (ex-UK)

7%

North America

83%

Asia Pacific

6%

China 33%

Asia Pacific

(ex-China) 55%

North America

5%

EMEA 5%

Lat America

2%

• London’s strength in supporting international companies improved in the last quarter with 4% increase in

international AUM managed out of London, more than any other financial centre. This is the third consecutive

quarter that London investors increased their investment in international companies.

• London listed companies continue to enjoy support of investors based outside London. North American investors

have increased their holdings of the LSE listed securities second quarter in a row and now account for almost a

third of equity investment based in London. After increases in the last quarter European investors kept their

positions of LSE equity unchanged, while LatAm investors have increased their positions in London listed stock

by 1%.

7

…And remains the heart of international investment

8

London provides enhanced analyst coverage

across all sectors

Source: Bloomberg, March 2014. Data covers average analyst coverage across listed companies.

Note: ICB sector classification

Average number of analyst recommendations following listed companies, by listing venue

0

5

10

15

20

25

30

35

40

LSEG NYSEEuronext

US

Nasdaq HKSE TMX NYSEEuronext

EU

Banking Sector

0

5

10

15

20

25

30

LSEG TMX NYSEEuronext

US

HKSE Nasdaq

Oil andGas

0

2

4

6

8

10

12

14

LSEG NYSEEuronext

US

TMX NYSEEuronext

EU

Nasdaq

Diversified Industrials

Technology and Healthcare (by market cap)

0

5

10

15

20

25

30

35

$0-50m $50-100m $100-250m $250-500m $500-1,000m $1,000-5,000m $5,000m+

LSEG NYSE Euronext US Nasdaq

9

0

2

4

6

8

10

12

14

16

18

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

Further New

123 145

107 75

102

277

177 160 162

355

519

462

284

114

36

102 90 71

99

26

0

100

200

300

400

500

1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013 2014

UK

Int'l

8 13

39

133 136

173

214

150

122

80

1bn+500-1bn250-500m100-250m50-100m25-50m10-25m5-10m2-5m0-2m

Profile of AIM companies Admissions to AIM – 1995 to March 2014

Fundraisings on AIM – 1995 to March 2014 Industries represented – by number of companies

1,094 companies,

aggregate value of

£78bn

A snapshot of AIM

Over 3,450

companies raising

£38bn at admission

£86bn in total

(£48bn through

further issues)

Source: LSE statistics, March 2014

26 companies either suspended or undetermined value

Oil & Gas, 132

Basic Materials, 179

Industrials, 191

Consumer Goods, 63 Health Care, 68

Consumer Services, 110

Telecommunications, 15

Utilities, 15

Financials, 210

Technology, 111

*ICB industry classification

9

10

Selected IPO Case Studies

10

11

Examples of recent European transactions

Mar 2014

AIM Digital Marketing

Mar 2014

AIM Hotel Chain

Feb 2014

Main Market Real Estate Fund

Jan 2014

AIM General Industrials

Dec 2013

AIM Mining

Nov 2013

Main Market Oil & Gas

Oct 2013

Main Market CEE Beverages/Spirits

Jul 2013

AIM Online Financial trading

Jul 2013

AIM CEE Real Estate Fund

Apr 2013

Main Market Beverages

Nov 2013

AIM

Mobile Gaming

Nov 2013

AIM Online Business Services

April 2014

AIM Mobile Payment

Feb 2014

AIM Real Estate

April 2014

AIM Fashion

Company Details

Company Safecharge

International Group plc

Market AIM

Sector Support Services

Trading System SETSqx

Country of

incorporation British Virgin Islands

Transaction Details

Admission Date 2 April 2014

Money raised at

admission $126m

Market Cap at offer $404m

Current Market Cap $414m

Lead Managers Shore Capital

Company profile

Founded in 2006, SafeCharge has become

one of Europe's leading clearing companies,

with a focus on the gaming industry as well

as online trading companies within the FX

space (Forex, Binary Options). It provides

payment services, risk management and IT

solutions to simplify online and mobile

payments.

Between 2010 and 2013 the total value of

transactions processed by the Group on

behalf of merchant clients increased from

US$1.6bn to US$4.8bn.

Employs 200 people in: UK, Cyprus

Bulgaria, Austria and Germany.

Listing story

Safecharge’s initial plan was to raise

USD100mln, but ended up raising 25% more

due to strong investor demand.

2nd IPO of Teddy Sagi (Israeli billionaire)

who is also a majority owner of Playtech one

of the world’s leading gaming software

companies

The company will use the proceeds for both

organic and inorganic growth

Post-IPO ownership structure will se Teddy

Sagi

Case Study:

Safecharge

Source: FactSet, April 2014

12

Post-IPO insiders/Investors Value held

£m

Teddy Sagi 66.7%

David Avgi(CEO) 2.9%

JP Morgan Asset management 6.3%

Henderson Global 5%

Source: FactSet – May 2014

Price chart rebased to 100 as of IPO date

Company profile

KW launched its European operations through

Kennedy Wilson Europe Limited in June 2011

and as at 31 December 2013, KW Europe had

grown to employ approximately 50 investment

professionals across London, Dublin and

Madrid

The Company will be well positioned to take

advantage of the significant number of

opportunities over the medium term to acquire

high quality real estate assets from distressed

sellers and financial institutions seeking to

delever by divesting such assets, and thereby

benefit from the improving market sentiment of

the European real estate sector.

Listing story

The IPO has successfully raised $1.5 billion

through the issue of 91 million ordinary

shares at $15 each.

The net proceedings of the placing will allow

KWE to invest in real estate targets across

Europe, with an initial focus on the UK,

Ireland and Spain

Across the entire portfolio, KWE will not

exceed a 50% leverage threshold, but

individual transactions can be leveraged up

to 65% at the time of borrowing.

Leading institutional investors Value held $m

Marketfield Asset Management 228

Soros Fund Management 194

Wellington Management 176

Janus Capital Management 93

BAMCO 30

Fidelity Management & Research 16

FIL Investments International 10

AllianceBernstein 7

Henderson Global Investors 4

Massachusetts Financial Services 3

Company Details

Company Kennedy Wilson Europe

Real Estate plc

Market Main Market

Sector Real Estate

Investment & Services

Trading system SETS

Country of

incorporation Jersey

Transaction Details

Admission date: 28 Feb 2014

Money raised at

admission $1.5bn

Current Market

cap $1.7bn

Sponsor Deutsche Bank

Case Study:

Kennedy Wilson Europe

Real Estate plc

13

Price r

ebased t

o 1

00

13

88

90

92

94

96

98

100

102

Feb-14 Mar-14 Mar-14 Apr-14 Apr-14 May-14

Kennedy Wilsone Real Estate plc FTSE All-Share

Company Details

Company JUST EAT

Market HGS

Sector Specialty Retailers

Trading System SETS

Country of

incorporation UK

Transaction Details

Admission Date 3 Apr 2014

Money raised at

admission £360m

Current Market Cap £1.8bn

Lead Managers Goldman Sachs

JP Morgan

Company profile

Just-Eat.co.uk provides online takeaway

ordering services to web surfers with some

restaurants they could choose from.

The Company has a leading position in the

majority of the 13 markets in which it

operates, including the U.K., Denmark,

France, Canada, Ireland and Spain.

Since the first Just Eat website was

launched in 2001, the company has grown

significantly, predominantly organically but

also via selected acquisitions and today

partners with over 36,000 takeaway

restaurants globally.

The Company was founded in 2001 and is

located in Borehamwood, United Kingdom.

Listing story

Just Eat is the first company to be admitted to

LSE’s High Growth Segment.

The company, which operates the world’s

largest online marketplace for restaurant

delivery , raised £360 million at IPO, making

it the largest internet company to float on

London Stock Exchange 2014YTD.

The Offering consisted in £100m primary

offering together with secondary offering

tranche of between £70m and £200m.

Selling Shareholders include SM Trust, Index

Ventures, Vitruvian Partners, Redpoint

Ventures and Greylock Partners.

Case Study:

Just Eat

Source: FactSet, April 2014

Price performance is intraday and refers to the IPO date 14

240

250

260

270

280

290

300

08:05 09:05 10:06 11:15 12:26 13:27 14:28 15:37

Pri

ce (

GB

p)

15

15 *Source: Factset and CCH company Prospectus

Company Details

Company Coca Cola HBC AG

Market Main Market

Sector Beverages

Admission to Premium

Segment

29 April 2013

Country of incorporation Switzerland

Sponsors Credit Suisse, JP

Morgan

Currency GBP

London 87%

New York 1%

Athens 12%

London 1%

New York 11%

Athens 88%

CCH - volume traded, comparison across the venues

• Transfer to London had a positive effect on

share performance and volume

immediately upon announcement.

• Investor and advisory community agreed

that access to the larger and more

sophisticated market better reflects the

valuation of the company and its global

share register

• London, as a global centre of finance, is in

a better position to cater for a company with

global operations such as Coca Cola HBC

“…London listing will give us greater recognition among international

investors, will increase the liquidity of our stock and improve our

access to the international equity and debt markets…”

Dimitris Lois, CEO

Case Study:

Coca Cola HBC AG

Before London listing After London listing

16

2m

-

100

200

300

400

500

600

Oct-12 Oct-12 Nov-12 Dec-12 Jan-13 Feb-13 Mar-13 Apr-13 May-13

Vo

lum

e t

rad

ed

('0

00s)

60

80

100

120

140

160

Oct-12 Nov-12 Dec-12 Jan-13 Feb-13 Mar-13 Apr-13 May-13

Pri

ce Index

Coca Cola HBC AG -

Immediate performance improvement

Source: Bloomberg, May 2013

CCH receives regulatory approvals for the

commencement of the acceptance period

(trading in the stock more than doubles)

CCH announces move to London

(7% share price increase)

Trading in London starts

Average daily

volume for the

period

CCH - Trading and price performance

1m 1.1m 963k 5m

16

17

4,185 4,601

5,450

0

1,000

2,000

3,000

4,000

5,000

6,000

7,000

H1 2012 H2 2012 2013 YTD

GBPm

1%

19%

36%

44%

ROW

UK

Europe ex-UK

North America

Valuation enhancement as part of the London listing process

Source: Factset and Bloomberg, May 2013

Market Capitalisation, expressed in millions GBP, is computed as an average over the relevant time period 17

Before announcement After announcement

13.8x 13.2x 14.5x

17.9x

20.4x 28.9x

7.1x 7.0x 7.3x 8.2x

9.1x 9.9x

-

5

10

15

20

25

Q1 2012 Q2 2012 Q3 2012 Q4 2012 Q1 2013 Q2 2013

P/E NTM EV/EBITDA NTM

YTD

Average valuation by quarter

CCH – market capitalisation Institutional ownership geographic breakdown

Coca Cola HBC AG -

Q1 2014

Q1 2014

18 Source: Bloomberg, May 2013

CCH bond maturity is 16 Nov 2016, Benchmark bond is a German sovereign bond with similar maturity

18

0

50

100

150

200

250

300

350

Sep-12 Oct-12 Nov-12 Dec-12 Jan-13 Feb-13 Mar-13 Apr-13 May-13

spre

ad (

bps)

0

0.5

1

1.5

2

2.5

3

3.5

4

Sep-12 Oct-12 Nov-12 Dec-12 Jan-13 Feb-13 Mar-13 Apr-13 May-13

yie

ld (

%)

Benchmark Bond Yield CCH Bond Yield

Announcement of CCH’s planned

move to London, 100bps drop in

the corporate bond spread

Since the announcement, CCH bond

spread tightened to 143 bps from 276 bps

Since the

announcement CCH

cost of refinancing

decreased by 144 bps

CCH – bond spread and yield

Spread to benchmark

Coca Cola HBC AG -

Listing in London reduces cost of CCH’s other sources of funding

19

Prepare ahead

Early Look

Investor

Engagement

In an increasingly crowded primary market calendar, early preparation is critical

Very hard to accelerate an IPO process, so early preparation enhances ultimate timing flexibility

As activity increases, pressures / bottlenecks are likely to increase within advisory community – choosing the right advisers therefore

increasingly important

Buyside fund managers have been vocal in the past about wanting to meet management teams ahead of an IPO

This practice of “early look” engagement with a number of the key investors has been very valuable:

Feedback for the Company and owners at an early stage on the business model, the management team and likely valuation

parameters

Investors get an opportunity to build a rapport with management at this early stage, enhancing their likely participation at the IPO

Information at this stage can be carefully managed, such that management teams are not held to specific forecasts later at the time of the

IPO

Demand

Patterns have

Shifted

In recent UK IPOs, participation from US investors (who are significantly underweight Europe still) has typically totalled 30-50% of gross

demand

Appetite from retail both directly (spill-over from Royal Mail effect) and through intermediaries has been strong and merits real

consideration, especially for consumer-oriented businesses

Important to consider complementary distribution platforms in IPO syndicates to tap all of these pockets

Appetite Broad

Based

We have seen transactions over the last 12 months across all sectors – quality businesses will be well received

Royal Mail and Merlin IPOs, as well as jumbo placings in Lloyds Bank, Direct Line, indicate capacity for significant sized transactions

Particularly successful have been consumer-facing companies with strong brands (Countrywide, Foxtons, Conviviality / Bargain Booze)

Secondary components at IPO have been accepted, but the best performers (Countrywide, HellermanTyton, Stock Spirits, Foxtons) have

seen further monetisations since IPO at substantially improved price levels

Observation Comment

Lessons Learned from Recent IPOs

20

Contact us

For further information please refer to www.lseg.com or contact us

Luca Peyrano Head of Italy & Continental Europe Primary Markets +44 (20) 77973340 lpeyrano@lseg.com

Axel Kalinowski Manager - Continental Europe +44 207 797 4108 akalinowski@lseg.com

21

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