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IPO Watch Europe Q2 2021

Quarterly survey tracking the volume and value of IPOs on Europe's main stock exchanges.

European IPO activity delivered another strong quarter, achieving the busiest first half in recent history with 223 IPOs raising €44.6bn, compared to 31 IPOs raising €5.5bn in H1 2020. An improving economic backdrop and resilient equity markets contributed to new issuance momentum and, while the valuations are being tested harder, cornerstone and institutional investors continue to support strong equity stories.

Strong Q2 2021 European IPO activity to close remarkable first half

Q2 2021 delivered another strong quarter of IPO activity in Europe with H1 2021 marking the busiest first half in recent history. Robust global equity markets and low volatility supported by strong macroeconomic indicators, accommodative monetary policies and reopening of the economies boosted by the rollout of the vaccination programmes, all contributed to the ideal backdrop for IPOs during H1 2021. However, with a large number of competing IPOs and a certain degree of deal fatigue, investors have notably become more selective and price sensitive.

Frankfurt and Amsterdam were particularly busy, advancing to the first and second positions respectively by total IPO proceeds raised in Q2, boosted by a flurry of domestic and international deals such as Allfunds Group IPO in Amsterdam and SUSE, ABOUT YOU, Synlab IPOs in Frankfurt.

Focus on the European SPAC market

A number of SPACs have started to trade in Europe across Euronext Paris, Euronext Amsterdam, Borsa Italiana, Frankfurt and Stockholm stock exchanges with wide sector coverage such as e-commerce, technology, financials, ESG and renewables, while London is awaiting for changes to SPACs listing rules. Some of the common features of the European SPAC market included smaller deal sizes than what we had seen earlier in the year and a significant presence of cornerstone investors. Whilst the European SPAC issuance is expected to continue at a pace, the focus will be shifting towards SPAC mergers as target companies are being identified. The success of these de-SPACing transactions will be a key driver for normalisation of the SPAC market.

Strategic importance of ESG for equity story and IPO readiness

We have noted the importance of strategic approach to sustainability in our earlier reports, with it increasingly being one of the focus areas for IPO readiness. As ESG framework matures, a more robust ESG strategy, information on KPIs and reporting is expected by investors from the companies looking to go public, however there is still limited guidance around best practice. ESG strategy has now become an important pillar of the equity story and, as evidenced by recent transactions, investors integrate ESG considerations in their investment decision making process.

Contact us

Mark Hughes

Mark Hughes

Partner, UK Capital Markets Leader, PwC United Kingdom

Tel: +44 (0)7736 599759

Richard Spilsbury

Richard Spilsbury

Partner, PwC United Kingdom

Tel: +44 (0)7703 503562

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