IPO activity marches on – is this the return of the UK domestic IPO?

 

 
 
Press release
 
 
Date
Brussels, 5 April 2013
 
Contacts
Peter D’hondt, Partner
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Saskia Rademakers, Marketing & Communication
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 IPO activity marches on – is this the return of the UK domestic IPO?

A surge in floats of private equity-backed companies in March 2013
may be the first signs of a recovery in the European IPO market

PwC’s IPO Watch Europe Q1 2013 report found that activity for the quarter rose by 40% from €2.3 billion to €3.2 billion.  This increase was driven by LEG Immobilien raising €1.2 billion on the Deutsche Börse in the largest IPO of the year so far, and by a number of floats of domestic and private equity (PE)-backed companies in London. The debuts of Countrywide and esure in London raised more than €0.9 billion in March alone and represented two of the top 5 European IPOs of the quarter. These were the first UK PE-backed IPOs on London’s Main Market since AZ Electronic Materials in October 2010, and may pave the way for IPOs of other PE-backed companies as the year unfolds.  Overall, the PE-backed sector accounted for 47% of total proceeds in London and 28% of proceeds in Europe. The end of the quarter also saw two further PE-backed IPOs, with HellermannTyton in London and Moleskine in Italy admitted to trading in early April. Peter D’hondt, Partner at PwC in Belgium, said: “The first quarter of 2013 has been encouraging. If current market sentiment persists, London – and potentially the rest of Europe – appears set for a good year with a large pipeline of businesses assessing the market. We expect to see activity across a range of sectors throughout the year, notably banking, insurance, real estate and entertainment. PE houses have considered IPOs as an exit route for their investments over the past few years, but they have been dissuaded by changeable market conditions and negative sentiment from investors. The strong performance from these PE-backed IPOs will go a long way to restoring confidence and realigning the expectations of other sector players.” The level of interest and pricing of recent IPOs has been encouraging and shows the improved sentiment from investors.  Investor confidence has been given a further boost by the positive aftermarket performance from the top IPOs, with the majority either improving on or holding the offer price after IPO. The top performers were Crest Nicholson and Countrywide, which rose by approximately 34% and 11% respectively, by the end the quarter.   “London IPO activity materialised rapidly after the Christmas break, almost taking the markets by surprise, as companies moved quickly to take advantage of the uptick in the FTSE index and low volatility. The financial markets have proved more resilient in Q1 2013. Economic factors that have dissuaded investors in recent years do not appear to have had a negative impact in Q1. These include Moody’s downgrade of the UK’s credit rating, the reduction in UK growth forecasts for 2013 and the Cypriot bailout,” adds D’hondt.
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About IPO Watch Europe
 IPO Watch Europe surveys all new primary market equity IPOs on Europe’s principal stock
markets and market segments (including exchanges in Austria, Belgium, Denmark, France,
Germany, Greece, the Netherlands, Ireland, Italy, Luxembourg, Norway, Poland, Portugal,
Spain, Sweden, Switzerland and the UK) on a quarterly basis. Movements between markets on the same exchange and greenshoe offerings are excluded. This survey was conducted between 1 January and 31 March 2013 and captures new market IPOs based on their transaction date. All market data is sourced from the stock markets themselves and has not been independently verified by PwC.  
About PwC
PwC firms help organisations and individuals create the value they’re looking for. We’re a network of firms in 158 countries with more than 180,000 people who are committed to delivering quality in assurance, tax and advisory services. Tell us what matters to you and find out more by visiting us at www.pwc.com. PwC refers to the PwC network and/or one or more of its member firms, each of which is a separate legal entity. Please see www.pwc.com/structure for further details.
 
 
Information for editors

1.    PricewaterhouseCoopers is now ‘PwC’. It is still written with an upper case 'P' and 'C' and a lower case 'w'. Only for the logo are all the letters written in lower case. 2.    If you would like to interview Peter D'hondt, Partner, please contact Geert Poisquet (+32 479 33 44 89) at Luna (e-mail: Dit e-mailadres wordt beveiligd tegen spambots. JavaScript dient ingeschakeld te zijn om het te bekijken.). PwC press information can also be found in the PwC press room. 3.    For the full, detailed breakdown of IPO activity on the European exchanges, please see the attached data tables and charts IPO Watch Europe Survey Q1 2013 4.    Previous IPO Watch Europe Surveys and annual reviews are available at http://www.pwc.co.uk/eng/publications/IPO_Watch_Europe_previous_editions.html

 
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