Transact cautious amid early 2018 IPO plans

Transact cautious amid early 2018 IPO plans

Transact has told its shareholders it will list on the London Stock Exchange in early 2018.

Chief executive Ian Taylor said the company’s shareholders were “very happy” but said he needed to find a way for them to realise their capital in the business if they wanted.

He said: “The shareholders have had a very healthy dividend stream but at the same time there is not a lot of liquidity.”

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But Mr Taylor also warned that listing on a stock exchange would mean making sure investors understood the business.

He said: “Unless you are a nascent market behemoth, if your company does not fit its template, the market's most likely response is to downgrade its assessment of attractiveness and price rather than attempt to understand why the mismatch might be a good thing.

“As a company with an approach to many things that is contrary to received wisdom, we must consider how we manage ourselves in an environment where all laundry is washed in public.

“We must ensure that we have made whatever adjustments are inevitable and are ready to advocate our case where we believe the essence of success is to carry on in our own, quintessential, way.”

Beyond working towards listing on the stock market, Mr Taylor said Transact would “stick to its knitting” during 2017.

He said: “There are some ideas in the pipeline, so we are looking at ideas such as trust administration, but there are no radical plans for acquisition or anything like that.”

On the wider platform market, he said 2016 had been an eventful year with Aegon’s acquisition of Cofunds and Standard Life acquiring Axa Elevate.

But he said: “There are a number of platform businesses that don’t really know why they are doing what they are doing and it has been a reaction to what others are doing.

“The mere acquisition of scale is not a business goal. It doesn’t make much sense.

“We have been around for 17 years and we have had at least as many approaches to sell but we are not interested.”