British American Tobacco rebuffs shareholder calls to quit London for New York - reports
The London Stock Exchange has seen a string of departures this year, as companies flee from cheap valuations towards the deeper investor pool the US market offers.
In March this year, BAT's fifth-largest shareholder urged the company to move its primary listing from London to New York.
In an interview with the FT, Rajiv Jain, founder of GQG Partners, a $92bn US-based investment firm, said it «makes no sense» for the FTSE 100 company to remain on the UK stock market and that it had asked its owner to quit London.
The investor questioned the company's UK listing, pointing to the US-centric nature of the cigarette maker's business and the valuation gap between the company and its US-listed competitor Philip Morris International, where GQG is a top-10 shareholder.
British American Tobacco under pressure to exit London listing for US — reports
However, according to a new report by The Times, the company's newly-appointed Tadeu Marroco, who was promoted from group finance director in May following the sudden departure of Jack Bowles, said it is «very simplistic to attribute the valuation gap to the place where we are listed».
«I note that there is an overall difference in terms of valuation between S&P 500, for example, and the FTSE 100, but it is much more related to the sectors that are present in those indices and the weight of those sectors in the first place,» he said.
'Another kick in the teeth': Why is London's stock market light fading?
The CEO warned «there is no certainty that you can get into the index in the US», running the risk of «being in limbo».
«So I would doubt very much that 75% of shareholders would approve [the move]. I have so many other things to do, that would not be top of my priorities.»
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