AstraZeneca’s New York shift augurs London exodus

Relx

07/10/2025 09:58

The author is a Reuters Breakingviews columnist. The opinions expressed are her own.

By Aimee  Donnellan

DUBLIN, Oct 7 (Reuters Breakingviews) - AstraZeneca’s AZN.L New York pivot contains a booby prize for the UK government. Last week, the $264 billion Anglo-Swedish pharma giant announced a plan to list its shares directly in the U.S. While the group will keep its primary listing in the UK, the move may still be a big blow to both Chancellor Rachel Reeves’ tax revenues and the City of London’s status as a financial centre.

AstraZeneca’s plan is about more than tax.The drugmaker led by Pascal Soriot is hoping that by listing shares directly in New York it will be able to access a deeper pool of capital, as its current American depositary receipts are restricted only to certain kinds of investors. Yet the new structure means that all trades will in future be settled through the New York Stock Exchange, including those in London. As a result, British traders will no longer be required to pay the 0.5% stamp duty levy which raised some 4.9 billion pounds in the year to the end of June.

Soriot’s group is not only the largest listed company in London but it is also one of the most liquid. On average 2.3 million AstraZeneca shares changed hands each day over the past two months, implying perhaps 575 million are traded each year, assuming 250 working days. Multiply that by the company’s share price of 127.50 pounds and apply the 0.5% stamp duty charge, and the UK government stands to miss out on over 360 million pounds once AstraZeneca’s UK trades are no longer eligible for stamp duty.

The problem for UK Prime Minister Keir Starmer is AstraZeneca is not an outlier. The group is pivoting more towards the U.S., and hopes to generate around 50% of its revenue stateside by 2030. Other London-listed groups with large U.S. businesses have gone a step further and announced plans to move their primary listing to the United States, such as Ashtead AHT.L. But that takes time, and can anger UK shareholders. AstraZeneca’s model still allows a company to tap into U.S. liquidity, while keeping shareholders sweet, and as such may be widely followed. Other candidates include Compass CPG.L, a $58 billion food service company which makes nearly 70% of its sales in the U.S., or tech-orientated companies like $43 billion Experian EXPN.L or $85 billion analytics firm RELX REL.L.

The UK government could therefore take a significant hit. If just Shell SHEL.L, Experian, RELX and Compass followed Soriot, the loss of stamp duty would be over 840 million pounds, according to Breakingviews calculations. And there’s a longer-term threat: the more companies’ shares are traded stateside, the more likely they are to consider eventually moving their primary listing and potentially headquarters there too. To counter such a scenario the UK government has two unappealing options. It could scrap stamp duty, which might boost trading and hence London’s appeal. Or it could pass a law to prevent companies from settling UK-listed trades in New York. But that would antagonise U.S. President Donald Trump, and may even encourage some firms to redomicile anyway. For now, the only certainty for Reeves is lower tax revenue.

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CONTEXT NEWS

AstraZeneca said on September 29 it plans to directly list its shares on the New York Stock Exchange, instead of its current depositary receipts structure. The drugmaker said it planned to attract more global investors but will remain listed and headquartered in London.

Large UK-listed companies rely heavily on the US market for sales https://www.reuters.com/graphics/BRV-BRV/dwpklwgqyvm/chart.png

(Editing by Neil Unmack; Production by Oliver Taslic)

((For previous columns by the author, Reuters customers can click on DONNELLAN/Aimee.Donnellan@thomsonreuters.com))