This chapter applies to an applicant for the admission of equity shares to premium listing (commercial company) except where:11

1. (1)

   the applicant meets the following conditions:11

   1. (a)

      it has an existing premium listing (commercial company) of equity shares;11

   2. (b)

      it is applying for the admission of equity shares of the same class as the shares that have been admitted to premium listing; and11

   3. (c)

      it is not entering into a transaction classified as a reverse takeover; or11

2. (2)

   the following conditions are met:11

   1. (a)

      a company has an existing premium listing (commercial company) of equity shares; 11

   2. (b)

      the applicant is a new holding company of the company in (a); and 11

   3. (c)

      the company in (a) is not entering into a transaction classified as a reverse takeover.11

1 7 7 4 3 7 4 3

1An applicant must have published or filed historical financial information that:

1. (1)

   covers at least three years;

   [Note: article 44 of the CARD]

2. (2)

   represents at least 75% of the applicant's business for the period in (1);

3. (3)

   unless LR 5.6.21R applies, has a latest balance sheet date that is not more than:

   1. (a)

      six months before the date of the prospectus or listing particulars for the relevant shares; and

   2. (b)

      nine months before the date the shares are admitted to listing; and

4. (4)

   includes the consolidated accounts for the applicant and all its subsidiary undertakings.

1Where an applicant has made an acquisition or series of acquisitions such that its own consolidated financial information is insufficient to meet the 75% requirement in LR 6.2.1R(2), there must be historical financial information relating to the acquired entity or entities which has been published or filed and that:

1. (1)

   covers the period from at least three years prior to the date under LR 6.2.1R(3) up to the earlier of:

   1. (a)

      the date in LR 6.2.1R(3); or

   2. (b)

      the date of acquisition by the applicant;

2. (2)

   is prepared and presented in a form that is consistent with the accounting policies adopted in the financial information required by LR 6.2.1R; and

3. (3)

   in aggregate with its own historical financial information represents at least 75% of the enlarged applicant's business for the period in LR 6.2.1R(1).

1The historical financial information in LR 6.2.1R and LR 6.2.3R must:

1. (1)

   have been audited or reported on in accordance with the standards acceptable under item 20.1 of Annex I of the PD Regulation; and

2. (2)

   not be subject to a modified report, unless the circumstances set out in LR 6.2.5G apply.

1An applicant must:

1. (1)

   take all reasonable steps to ensure that the person providing the opinion in LR 6.2.4R(1) is independent of it; and

2. (2)

   obtain written confirmation from the person providing the opinion in LR 6.2.4R(1) that it complies with guidelines on independence issued or approved by its national accountancy or auditing bodies.

1The historical financial information required under LR 6.2.1R and LR 6.2.3R must:

1. (1)

   demonstrate that the applicant has a revenue earning track record; and

2. (2)

   put prospective investors in a position to make an informed assessment of the business for which admission is sought.

1An applicant must demonstrate that it carries on an independent business as its main activity.

1An applicant with a controlling shareholder must demonstrate that, despite having a controlling shareholder, the applicant is able to carry on an independent business as its main activity.

1An applicant with a controlling shareholder upon admission must have in place a written and legally binding agreement with its controlling shareholder which is intended to ensure that the controlling shareholder complies with undertakings that:

1. (1)

   transactions and arrangements with the controlling shareholder (and/or any of its associates) will be conducted at arm’s length and on normal commercial terms;

2. (2)

   neither the controlling shareholder nor any of its associates will take any action that would have the effect of preventing the applicant from complying with its obligations under the listing rules; and

3. (3)

   neither the controlling shareholder nor any of its associates will propose or procure the proposal of a shareholder resolution which is intended or appears to be intended to circumvent the proper application of the listing rules.

1An applicant with more than one controlling shareholder is not required to enter into a separate agreement with each controlling shareholder if:

1. (1)

   the applicant reasonably considers, in light of its understanding of the relationship between the relevant controlling shareholders, that a controlling shareholder can procure the compliance of another controlling shareholder and that controlling shareholder’s associates with the undertakings in LR 6.5.4R; and

2. (2)

   the agreement, which contains the undertakings in LR 6.5.4R, entered into with the relevant controlling shareholder also contains:

   1. (a)

      a provision in which the controlling shareholder agrees to procure the compliance of a non-signing controlling shareholder and its associates with the undertakings in LR 6.5.4R; and

   2. (b)

      the name of such non-signing controlling shareholder.

1An applicant must demonstrate that it exercises operational control over the business it carries on as its main activity.

1An applicant must satisfy the FCA that it and its subsidiary undertakings (if any) have sufficient working capital available for the group's requirements for at least the next 12 months from the date of publication of the prospectus or listing particulars for the shares that are being admitted.

1The total of all issued warrants to subscribe for equity shares or options to subscribe for equity shares must not exceed 20% of the issued equity share capital (excluding treasury shares) of the applicant as at the time of issue of the warrants or options.

1For the purpose of the 20% limit in LR 6.8.1R, rights under employees’ share schemes are not included.

1An applicant must have in place a constitution that allows it to comply with the listing rules, in particular:

1. (1)

   LR 9.2.21R to vote on matters relevant to premium listing; and

2. (2)

   for an applicant with a controlling shareholder, LR 9.2.2ER and LR 9.2.2FR concerning the election and re-election of independent directors.

1If the law of the country of its incorporation does not confer on shareholders rights which are at least equivalent to LR 9.3.11R, an overseas company applying for a premium listing must:

1. (1)

   ensure its constitution provides for rights which are at least equivalent to the rights provided in LR 9.3.11R (as qualified by LR 9.3.12R); and

2. (2)

   be satisfied that conferring such rights would not be incompatible with the law of the country of its incorporation.

1Where a mineral company applies for the admission of its equity shares to a premium listing and cannot comply with the minimum three-year period required in LR 6.2.1R(1) because it has been operating for a shorter period:

1. (1)

   the mineral company must have published or filed historical financial information since the inception of its business; and

2. (2)

   the following apply to the mineral company only with regard to the period for which it has published or filed historical financial information pursuant to (1):

   1. (a)

      LR 6.2.1R(2), LR 6.2.1R(3) and LR 6.2.1R(4) (content of historical financial information); and

   2. (b)

      LR 6.2.4R and LR 6.2.6R (audit requirements for historical financial information).

1 LR 6.3.1R (revenue earning track record) does not apply to a mineral company that applies for the admission of its equity shares to a premium listing.

1. (1)

   1This rule applies if the mineral company applies for the admission of its equity shares to premium listing and cannot comply with LR 6.6.1R (control of business) because the mineral company does not hold controlling interests in a majority (by value) of the properties, fields, mines or other assets in which it has invested.

2. (2)

   The mineral company must demonstrate that it has a reasonable spread of direct interests in mineral resources and has rights to participate actively in their extraction, whether by voting or through other rights which give it influence in decisions over the timing and method of extraction of those resources.

1Where a scientific research based company applies for the admission of its equity shares to a premium listing and cannot comply with the minimum three-year period required in LR 6.2.1R(1) because it has been operating for a shorter period:

1. (1)

   the scientific research based company must have published or filed historical financial information since the inception of its business; and

2. (2)

   the following apply to the scientific research based company only with regard to the period for which it has published or filed historical financial information under (1):

   1. (a)

      LR 6.2.1R(2), LR 6.2.1R(3) and LR 6.2.1R(4) (content of historical financial information); and

   2. (b)

      LR 6.2.4R and LR 6.2.6R (audit requirements for historical financial information).

1If the scientific research based company does not comply with either LR 6.2.1R(1) (minimum period for historical financial information) or LR 6.3.1R (revenue earning track record), it must:

1. (1)

   demonstrate its ability to attract funds from sophisticated investors prior to the marketing at the time of listing;

2. (2)

   intend to raise at least £10 million pursuant to a marketing at the time of listing;

3. (3)

   have a capitalisation, before the marketing at the time of listing, of at least £20 million (based on the issue price and excluding the value of any equity shares which have been issued in the six months before listing);

4. (4)

   have as its primary reason for listing the raising of finance to bring identified products to a stage where they can generate significant revenues; and

5. (5)

   demonstrate that it has a three year record in laboratory research and development including:

   1. (a)

      details of patents granted or details of progress of patent applications; and

   2. (b)

      the successful completion of, or the successful progression of, significant testing of the effectiveness of its products.

1Where a property company applies for the admission of its equity shares to a premium listing and cannot comply with LR 6.3.1R because it does not have a revenue earning track record:

1. (1)

   the property company must demonstrate that it has three years of development of its real estate assets represented by increases of the gross asset value of its real estate assets:

   1. (a)

      evidenced by the historical financial information required by LR 6.2.1R; and

   2. (b)

      supported by a published property valuation report; or

2. (2)

   the property company must demonstrate that 75% of the gross asset value of an applicant’s real estate assets, as supported by a published property valuation report, are revenue generating at the point in time when the application for admission of the equity shares to a premium listing is made.

1Where a property company is relying on LR 6.12.1R(2) and cannot comply with LR 6.2.1R(1) because it has been operating for a shorter period:

1. (1)

   the property company must have published or filed historical financial information since the inception of its business; and

2. (2)

   the following apply to the property company only with regard to the period for which it has published or filed historical financial information under (1):

   1. (a)

      LR 6.2.1R(2), LR 6.2.1R(3) and LR 6.2.1R(4) (content of historical financial information); and

   2. (b)

      LR 6.2.4R and LR 6.2.6R (audit requirements for historical financial information).

1An applicant must satisfy the FCA that:

1. (1)

   the discretion of its board to make strategic decisions on behalf of the applicant has not been limited or transferred to a person outside the applicant’s group; and

2. (2)

   its board has the capability to act on key strategic matters in the absence of a recommendation from a person outside the applicant’s group.

1Where an applicant is applying for the admission of a class of equity shares to premium listing, a sufficient number of shares of that class must, no later than the time of admission, be distributed to the public in one or more EEA States.

[Note: article 48 of the CARD]

1For the purposes of LR 6.14.1R:

1. (1)

   account may also be taken of holders in one or more states that are not EEA States, if the shares are listed in the state or states;

2. (2)

   a sufficient number of shares will be taken to have been distributed to the public when 25% of the shares for which application for admission has been made are in public hands; and

3. (3)

   treasury shares are not to be taken into consideration when calculating the number of shares of the class.

[Note: article 48 of the CARD]

1For the purposes of LR 6.14.1R and LR 6.14.2R, shares are not held in public hands if they are:

1. (1)

   held, directly or indirectly by:

   1. (a)

      a director of the applicant or of any of its subsidiary undertakings; or

   2. (b)

      a person connected with a director of the applicant or of any of its subsidiary undertakings; or

   3. (c)

      the trustees of any employees’ share scheme or pension fund established for the benefit of any directors and employees of the applicant and its subsidiary undertakings; or

   4. (d)

      any person who under any agreement has a right to nominate a person to the board of directors of the applicant; or

   5. (e)

      any person or persons in the same group or persons acting in concert who have an interest in 5% or more of the shares of the relevant class;

2. (2)

   subject to a lock-up period of more than 180 calendar days.

[Note: article 48 of the CARD]

1The FCA will not admit shares of an applicant incorporated in a non-EEA State that are not listed either in its country of incorporation or in the country in which a majority of its shares are held, unless the FCA is satisfied that the absence of the listing is not due to the need to protect investors.

[Note: article 51 of the CARD]