Activist wants New York listing for Watches of Switzerland

The activist investor Gatemore Capital Management has called for Watches of Switzerland to join the exodus of London-listed companies across the Atlantic and move its primary listing to New York.
Gatemore, which holds about 1.9 million shares, or 0.8 per cent of the luxury retailer, urged bosses to make the move to “fully unlock the value” of the stock.
The activist said listing in New York would provide Watches of Switzerland with access to deeper pools of capital, an increase in liquidity and more exposure to long-term investors.
Gatemore also said the move would allow the retailer to make the most of its expansion in the United States, where it believes the company will generate most of its future revenue.
Watches of Switzerland made 45 per cent of its revenues in the US in the year to April 28. Gatemore estimates that by 2028 the American market will contribute to 60 per cent of the retailer’s sales.
Shares in Watches of Switzerland have fallen by more than 35 per cent since the start of the year, following a profit warning in January.
Last month Gatemore called on the FTSE 250 retailer to pursue a share buyback of between £25 million and £50 million. The activist said the move “would reinforce the board’s confidence in the business” and affirm its commitment to maximising shareholder returns.
In recent years the UK’s stock market has suffered a rise in the number of companies dropping London as their primary listing venue, where lower valuations compared with the US have left Britain struggling to prevent companies leaving and to attract initial public offerings.
Liad Meidar, managing partner at Gatemore, said that with “a clear leading position in the UK market”, Watches of Switzerland was now “well positioned to unlock additional growth in the massive and underpenetrated US market”.
He added that the company should explore the acquisition of other watch retailers and potential takeover deals in the US.
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If Watches of Switzerland did make a move to the US, it would join a number of other London-listed companies that have been attracted to New York’s stock market.
CRH, the building materials group, made the move in September 2023. Flutter Entertainment, the owner of Paddy Power and Betfair, moved earlier this year, as did Indivior, the drugs maker. Shares in CRH have climbed by more than 60 per cent since it moved its primary listing.
Concerns about the future of the London Stock Exchange have spurred City regulators and the government into a series of reforms aimed at making the UK a more attractive place for companies to go public. They include a revamp of the listing rules, which came into force in July.
On Wednesday shares in Watches of Switzerland closed down 3½p, or 0.8 per cent, at 433½p.
Watches of Switzerland was contacted for comment.