CAB Payments shares slip in London debut

LONDON (Reuters) -Shares in British money transfer group CAB Payments slid on their first day of trading in London, following an initial public offering (IPO) meant to give a boost to the UK's capital markets.

CAB Payments, backed by private equity firm Helios Investment Partners, said on Thursday morning it had successfully placed shares at 3.35 pounds ($4.28) through its IPO, raising up to 335 million pounds in proceeds.

The shares subsequently began trading conditionally on the London Stock Exchange (LSE), ending the day at 3.03 pounds.

Conditional - or deferred settlement - dealing is a feature of the London market that allows stock to change hands ahead of a full debut.

Unconditional trading is set to start on July 11.

"Deciding to list signifies our confidence in the proposition we bring to clients and our new, enlarged investor base, as well as the confidence that we have in the UK as the home for innovative and growing global fintech businesses," Chief Executive Bhairav Trivedi said in a statement.

The IPO comes amid doubts about London's appeal as a capital markets centre following a string of high-profile moves to other bourses by domestic or locally listed firms.

Earlier this year, Cambridge-based chipmaker Arm rebuffed a campaign from the British government to list its shares in London, saying it would pursue a flotation on a U.S. exchange.

Last month, natural soda ash producer WE Soda cancelled plans to list in London over a valuation dispute with investors.

The London bourse hailed CAB Payments' listing as recognition of the British capital as a "vibrant market" for financial technology firms, many of which in recent years have hinted at fleeing to New York in search of higher valuations.

"We are delighted to welcome the IPO of CAB Payments. The global nature of the business, serving growing markets, backed by a global investor base, sums up in many ways London's strengths," LSE CEO Julia Hoggett said in a statement.

While listing activity remains subdued amid high interest rates, Britain saw a 29% rise in cash raised through IPOs in the first half of the year, data from consultancy EY showed, in a sign markets may be starting to bounce back.

"The London IPO market continues to experience challenges with macroeconomic and geopolitical pressures having an adverse impact on businesses looking to list in the UK," EY's IPO leader for the UK and Ireland, Scott McCubbin, said in a statement this week.

"These headwinds will need to abate to enable real growth, however with some larger IPOs expected in 2024 and a strong pipeline, the long-term outlook looks more positive."

($1 = 0.7831 pounds)

(Pablo Mayo Cerqueiro in London; editing by Emelia Sithole-Matarise, Jason Neely and David Evans)