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The London Stock Exchange Group’s (LSEG.L) upcoming private securities market, powered by the Pisces framework, will be a transformative innovation that will open up liquidity in the private capital space, according to CEO David Schwimmer.
The Private Intermittent Securities and Capital Exchange System (Pisces), proposed by the previous Conservative government and backed by Labour chancellor Rachel Reeves, will allow investors in private companies to sell shares on regulated exchanges.
The London Stock Exchange Group is one of the companies planning to operate a Pisces trading venue, where shares could be traded on a limited number of days each year.
“I think it’s a good innovation,” Schwimmer told Yahoo Finance UK, signalling his optimism about the platform’s potential impact on both private companies and institutional players.
The LSEG CEO explained how the platform would enable private companies to access public market infrastructure without going public.
Read more: What you need to know about UK’s private stock market Pisces
“The private securities market that we are launching this year, which is on the Pisces framework, is a really interesting innovation for this market,” Schwimmer said, adding that there has been a growing demand for liquidity among private companies.
While many private companies today remain closed off to public investors, Schwimmer said that the market for private equity is expanding rapidly.
“You have a lot of companies now that are sizeable and maybe looking for liquidity but do not want to go public”, he explained. These companies may seek liquidity for their limited partners (LPs), shareholders, or employees, without leaping to a complete public listing.
For Schwimmer, the Pisces platform solves this dilemma, offering access to the same infrastructure and liquidity typically reserved for publicly traded firms, filling a critical gap in the market.
According to Schwimmer, one of the key advantages of the Pisces framework is that it can serve as a conduit for institutional investors, who in the past have had limited access to private companies.
“Historically, institutional investors have not had a lot of access to private companies unless they get to participate in an opaque kind of one-off private placement process,” he said, pointing to the exclusivity of most private equity transactions. By leveraging the structure of the London Stock Exchange, Pisces should give institutional investors more transparency and access to the growing pool of private market assets.
