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LONDON: Electrosteel Castings, an Indian manufacturer, is the first company to issue global depository receipts on the Professional Securities Market (PSM), the London Stock Exchange's market for wholesale securities.
The company, which makes iron pipes and fittings for the water and sewage industry, raised $35m on October 5, with another $5.0m greenshoe option to be placed within November 5.
The professional securities market, launched in July, is designed for issuers whose financial data are reported under their home country's accounting standards. It was developed to attract foreign companies to list in London.
By joining PSM, companies can keep using their home jurisdiction accounting standards, instead of conforming to International Financial Reporting Standards (IFRS).
"This new market is a pragmatic solution for those overseas companies who elect to report in their home jurisdiction accounting standards to access one of the world's largest pools of international capital;" said Tracey Pierce, head of international business development at the LSE.
The GDPs are dollar-denominated, tradeable equity securities that are issued by a depository bank on behalf of the company. They are only offered to institutional investors.
Electrosteel Castings was the first company to raise funds in a new listing on PSM, but the market consists of 61 other companies which transferred their existing listed securities from LSE's main list.
The company will use the proceeds to expand its annual production of ductile iron pipes in Kolkata factory from 200,000 tonnes to 250,000 tonnes.
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