Following a significant slowdown in new listings, the potential initial public offerings of several UK financial services firms could be the catalyst for the next phase of Europe’s economic recovery, a Bloomberg report suggests.
It was recently reported that Canopius Group investors are considering an IPO for the Lloyd’s insurance firm. Banco Santander is also contemplating an IPO for its UK payments subsidiary Ebury, according to Bloomberg.
Additionally, the release of Revolut’s annual accounts has ignited speculation about a future IPO after the challenger bank stated it was aligning its financial processes with the standards expected from publicly listed firms. Although Revolut previously ruled out a London listing, the company now appears more open to the idea.
Bloomberg highlighted that the prospective IPOs could provide a much-needed boost to a market that has been sluggish despite a promising start to the year.
PwC UK capital markets director Adam Cox noted that financial companies are well-positioned to attract investor interest due to high interest rates and improving economies.
Cox was quoted as saying: “The UK also has a strong reputation for financial services which underpins some of the activity here – when the equity story centres around a UK-based business with either domestic or international growth plans, there will be a substantial investor pool in the London market.”
In 2021, London held a 25% share of the European IPO market, the highest of any city. However, this year, the only notable new listing has been a £166 million IPO from computer maker Raspberry Pi. What could potentially fill the gap are listings from financial services firms.
Carlton Nelson, head of corporate broking and PLC advisory at Investec, commented: “I believe that we’ll see further IPO momentum building over the remainder of 2024 as issuers take advantage of the current low volatility environment, ahead of a broader market pickup in 2025.”
What do you think about this story? Share your thoughts in the comments below.
