United Drug exit deals fresh blow to Irish bourse

DUBLIN (Reuters) - Ireland's United Drug will delist from the Irish stock exchange next month and move its primary listing to the London Stock Exchange, the latest blow to the Dublin bourse which has already lost some big names during the country's financial crisis.

The drugs distribution and packaging services company, which now generates more than two thirds of its profits outside Ireland, said last month it was considering leaving the country's main stock market and confirmed on Thursday it would do so on October 3.

"We believe that the changes will increase the group's attractiveness to a wider international investor base and are a natural progression for United Drug," chief executive Liam FitzGerald said in a statement.

"These changes will have no impact on the business operations of United Drug and United Drug will remain headquartered, incorporated and tax-resident in Ireland".

The move is another setback for Ireland's ISEQ <.iseq> bourse which has seen trading volumes nosedive after a bank crash pushed the country into an 85 billion euro (67 billion pounds) EU/IMF bailout and wiped out some of the biggest companies on the index.

Building materials group CRH and drugmaker Elan , two of Ireland's largest companies, have also moved their primary listings outside of Ireland in the last year, though they still retain a secondary listing in Dublin.

"It is clear that this decision by United Drug is driven by the rules for inclusion in the FTSE UK Index Series, which require the majority of trading in a constituent company's shares to take place in the UK," the stock exchange said in a statement.

"United Drug currently accounts for approximately 1.1 percent of the ISEQ index. The index will be reweighted as appropriate when the company ceases to be a constituent."

The Dublin-based stock exchange, which saw its profile soar alongside the value of the country's banks during the property bubble-fuelled days of the "Celtic Tiger" economy, has not seen any new companies join its main market since 2007.

Five companies have been added the exchange's Enterprise Securities Market (ESM) in that period, joining the likes of rising oil and gas explorer Providence Resources and bruised lender Allied Irish Banks on the market aimed at small to medium sized companies.

United Drug, which has acquired five businesses outside Ireland since June, said it expected to be included in the FTSE All-Share index after the close of business on December 21.

Its shares were trading up nearly 1 percent at 2.62 euros by 12:38 p.m. British time on Thursday, while the London-listed shares traded at 207 pence, valuing the company at 627.5 million euros or 496 million pounds.

(Editing by Mark Potter and Greg Mahlich)

Source: http://news.yahoo.com/united-drug-exit-deals-fresh-blow-irish-bourse-115839447--finance.html

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