The Irish stock exchange is aiming to attract at least five new company listings each year to offset the recent departures of major firms such as CRH, Smurfit Westrock, and Flutter.
This goal follows a disappointing year in which Euronext Dublin failed to secure a single new listing. In contrast, its parent company, Euronext, added 53 listings across its six other European hubs, which was actually down 17 per cent on the year prior.
Adding to the challenges, two more Irish companies have signalled plans to leave the exchange. Hotel group Dalata is currently up for sale, and Molten Ventures, a state-backed venture capital firm, has also indicated its intention to delist from Dublin.
Daryl Byrne, chief executive of Euronext Dublin, which has owned the Irish exchange since 2018, said adding “six companies a year would be good”.
“It’s not that they [companies] are fleeing Ireland,” Byrne told the Business Post in Brussels, where he was meeting MEPs and diplomats to press Euronext’s case.
“Of course we had three: CRH, Smurfit and Flutter. When you look at their business strategy, the way that those companies have developed, they had outgrown the European market and they were very much focused on business development, strategic development and winning big business in the US.
“We never want to see any company leave, but the real issue is that we haven’t had a flow of companies coming through to replace those companies that have been leaving.”
Byrne is now focused on tapping smaller firms with market caps of up to €30 million to go public, as a way of bolstering Euronext Dublin’s fortunes.
He hopes to do that, in part, by pressing the government to reduce Ireland’s 1 per cent stamp duty (he is no longer lobbying to abolish it) and is asking the government to set up UK-style ISA investment accounts to funnel the tens of billions Irish savers have stashed in low-yield deposit accounts into Irish firms.
“Historically, our argument was around abolishing stamp duty because it’s antiquated, it’s distortionary, it’s uncompetitive and it just makes it more expensive to purchase shares in an Irish company than you know a company in a other European country,” Byrne said.
“Over the past few years we have nuanced our approach.”
Last month, in its pre-budget submission to the government, Euronext called for a stamp duty exemption on the trading of shares in Irish companies with a market valuation of less than €1 billion.
There is no stamp duty in several global financial centres including the US, Germany, The Netherlands and Luxembourg. The tax is 0.3 per cent in France.
In a letter to Jack Chambers last year, Byrne said the government is earning far less than it has in the past from the tax due to the departures of major corporations CRH, Flutter and Smurfit Kappa from the Irish market.
Euronext’s pre-budget submission also calls for an “incentivised savings and investment account scheme” for Ireland that would offer a tax-free way for people to earn interest on their savings and and listed companies to raise funds.
The accounts would be exempt from stamp duty, dividend levies and capital gains taxes, Byrne said.
“In Ireland, we have so many great high-potential scaling companies; the issue isn’t about a lack of companies,” Byrne said. “We are an outlier because so many countries across Europe and the UK have these types of products and they’ve had them for years.”
He says the time is ripe with a new government in Ireland keen to work with the stock exchange and the EU pressing its “savings and investment union” project, a rebranded capital markets union, as a way to boost the bloc’s economy.
“At a European level, there is a recognition of the urgency around using capital markets to fund the growth of European companies and then unlock bank deposits in Europe,” Byrne said. “All of that really feeds into what we’re doing at a domestic level.”
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