Shares in Grafton Group soared by 4 per cent to €7.05 this morning after the group, which operates the Woodies DIY chain in Ireland, announced it is to become the latest in a line of Irish public companies to depart the Irish Stock Exchange. Grafton will join the FTSE UK index series in a move designed to "increase the group's profile and its suitability as an investment for UK and international investors" . Companies with a primary listing outside of the UK are precluded from the indices.
The group, which is following in the footsteps of DCC, Greencore and United Drug, will cancel its shares on the ISEfrom October 15th, with shares traded solely, in sterling, on the London Stock Exchange thereafter. It is expected that Grafton will be included in the FTSE UK Index Series from the close of trading on December 20th.
Gavin Slark, chief executive officer with Grafton Group, said that the decision to move the listing responds to the "new realities" facing Grafton, including the "significant changes in its shareholder base with the majority of the group's shares now held by institutional investors outside Ireland, and will provide the group with the platform from which to grow the business even further".
The move comes as no surprise, as it was first mooted in late August, when the group announced it was reviewing its listing arrangements, on the grounds that three quarters of its revenue has, for some time, been generated in the UK and most of the group’s development activity is taking place outside Ireland.
The group’s full revenues will be reported in sterling, which the group believes, will “help to provide a clearer understanding of the group’s financial performance by reflecting the functional currency of the majority of the group’s operations, and that it will reduce the impact of currency movements on reported results”. Dividends will also be paid in sterling, although shareholders will have an option of receiving it in euro.
Grafton Group will remain headquartered, domiciled and tax resident in Ireland, and it “remains fully committed to its Irish operations”.
