In the UK alone, deals surged by 48% to total $26.1bn (£19.6 billion) over the first nine months of the year, compared with the same period a year ago
Despite political uncertainty causing a slowdown in global stock market debuts, the UK has surged ahead of its European counterparts with a burst of activity this year, according to new data.
The snap elections in France and the looming US presidential election have caused jitters among investors and dealmakers. Equity capital market activity, which includes initial public offerings (IPOs), had been gaining momentum this year but has decelerated in recent months.
An IPO is when a company makes its shares available on the public stock markets. Data from Dealogic revealed that global IPOs and other stock market debuts totalled around £398bn over the first nine months of the year, nearly 12% higher than the same period last year.
However, between July and September, deals were more than a fifth lower than between April and June. Dealogic stated this indicates a significant slowdown in what had started as a recovery year for global IPOs.
The UK has seen a stronger recovery since stock markets were impacted by a lack of IPO activity and several UK-listed firms being bought out or moving to foreign markets. In the UK alone, deals increased by 48% to total £19.6bn over the first nine months of the year, compared with the same period a year ago.
This performance made the UK a leading player in Europe, where political uncertainty resulted in a sharp decline in activity across the continent. For example, volatility across European markets led Italian trainer maker Golden Goose to shelve its plans for a Milan listing earlier this year.
Political uncertainty in France owing to surprise elections, has seen dealmakers and investors playing the waiting game—culminating in the dreariest quarter for European IPOs since early 2019. London saw Raspberry IPO with a £540m valuation, buoying market optimism.
February welcomed flotation announcements from MicroSalt and Kazakhstan’s Air Astana, while Rosebank Industries debuted on the London exchange in July. Fresh on the IPO horizon is JD Sports’ protege, the supplements enterprise Applied Nutrition, mulling over a London listing.
Ion Analytics’ equities capital markets chief, Samuel Kerr of Dealogic, remarked: “The slowing in deal flow coincided with an uptick in equity market volatility in August and nerves around this year’s snap French elections alongside the upcoming US elections. With global interest rates now falling, there is further impetus for equity deals, but dealmakers and investors alike are keeping a close eye on the November polls.”
