EU’s IPO market raised EUR 25.8 billion in the first nine months

The IPO (initial public offering) market in Europe had a value of EUR 25.8 billion in the first nine months of the year with London being the most active in Q3 with a total of EUR 1.9 billion. Only one mega-IPO took place in Q3, on the Swiss Stock Exchange, carried out by SIG Combibloc Group, which raised EUR 1.7 billion.

European IPOs raised EUR 3.9 bn in Q3 2018, down by 53 percent from Q3 2017 when EUR 8.3 bn was raised, according to PwC’s latest IPO Watch Europe. A lack of mega-IPOs contributed to the low values raised in Q3, with SIG Combibloc Group on the SIX Swiss exchange the only listing larger than EUR 1 billion at EUR 1.7 billion. This was the second largest IPO of 2018, behind Siemens Healthineers AG in Q1 2018 which raised EUR 3.7bn.

Sofia is one of the top four exchanges this quarter, behind London, Euronext and Borsa Italiana. The IPO of poultry producer Gradus in August was the largest on the Bulgarian Stock Exchange since 2007, when First Investment Bank raised EUR 42 million – and the first listing in Sofia since Q4 2016.

The London Stock Exchange remained the most active exchange in Europe in Q3 by volume and values for the second quarter in a row, with 16 IPOs raising EUR 1.9 billion. IPO volumes and values, however, are down by 41 percent and 29 percent respectively compared to Q3 2017 when 27 IPOs raised EUR 2.7 billion. Four out of the top five IPOs in Europe in Q3 2018 listed on the London Stock Exchange, with the largest IPO this quarter being Amigo Holdings, the provider of guarantor loans in the UK, which raised EUR 407 million.

“Geopolitical headwinds and the summer hiatus muted activity in Q3, with European IPO values at their lowest levels for two years.  The pipeline going into Q4 needs to be looked at in the context of the recent signals issued by the capital markets around the world, some of them posting, in the past period, important corrections. In this context we must not wait to for a mega-IPO in the near future,” said Sorin Petre, partner, Valuation and Economics, PwC Romania.

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“According to reports issued by the Bucharest Stock Exchange (BSE), the first nine months of this year brought 17.5 percent advance for the BET-TR index. The index reached record high values in August and registered the highest value since it was launched back in 2014. On the European level, Bucharest’s main index BET (8.5 percent) ranks second, for the first nine months, on the top growth rates for the main indices within the EU capital markets chart. It lags CYMAIN index of the Cyprus Stock Exchange who leads with 10.09 percent. Looking at the numbers, the local stock exchange market looks good but it still lacks the liquidity and constant IPOs being launched. This would strengthen the local capital market and would show investors and entrepreneurs that it is a viable solution for business development”, said Ileana Guțu, senior manager, Valuation and Economics, PwC Romania.