The UK’s Financial Conduct Authority (FCA) has proposed a new trading platform, the Private Intermittent Securities and Capital Exchange System (PISCES), aimed at enabling private companies to auction shares to vetted investors without going public. The initiative is designed to provide a flexible, cost-effective alternative to traditional IPOs, while giving investors access to a broader range of private equity opportunities.
PISCES: A New Route for Private Share Trading in the UK?
PISCES would allow companies to host periodic trading events, during which shareholders can sell existing equity. Participation would be limited to institutional investors, company employees, and high-net-worth individuals or sophisticated investors, helping to ensure a level of financial experience and risk awareness.
The FCA plans to develop the platform within its regulatory sandbox, with legislation expected from the Treasury by May 2025. The platform is part of a wider strategy to boost UK capital market competitiveness by supporting private sector growth.
Advantages for Companies and Investors
For private companies, PISCES offers a cost-effective and flexible mechanism to provide liquidity to shareholders and attract new investment without the obligations of a full public listing. The platform’s intermittent trading model allows companies to control the timing and terms of share sales, potentially making it an attractive stepping stone toward a future IPO. Investors, on the other hand, gain access to a curated selection of private companies, expanding their investment horizons beyond traditional public markets.
While the move has been welcomed by some in the fintech and venture capital sectors, critics have raised concerns about limited investor protections and the potential lack of demand. Questions remain about the absence of comprehensive rules on insider trading and market abuse within PISCES, which could impact investor confidence.
Still, if successful, PISCES could become a vital stepping stone for private firms seeking liquidity or preparing for public markets, while offering new investment channels to eligible backers.
