On the anniversary of Brexit this week, Neil Goddin, Head of Equities at Aegon Asset Management, shares his insights on the state of the London stock market.
What has actually happened to the IPO market in the UK? And how bad is it really?
The honest answer is: it’s bad. Not just a little bit bad – structurally bad ‘And it’s not just a UK problem. Across global public equities, the number of listed companies has been falling for years. But in the UK, those trends feel more pronounced, more visible, and frankly more worrying.
For a long time, the explanation was easy enough: companies didn’t need to list. Asset-light, especially tech-driven businesses, could stay private, raise vast sums of capital, and avoid the public markets altogether. Why bother with quarterly reporting and scrutiny when private capital was effectively unlimited?
Now the narrative is starting to shift. You can argue that an AI-driven world might require more capital (likes markets in the past), which in theory should favour public markets. But it’s far from clear that this leads to a broad reopening of IPO markets. There’s a risk it’s just the same handful of mega-cap names – the 3 or 4 big tech IPOs – that grab the headlines and give the illusion of recovery, while the underlying market remains thin.
In the UK, though, it’s even worse than that. The few companies that do IPO are increasingly doing it elsewhere – typically in the US. And at the same time, established UK companies are voting with their feet. CRH, Ashtead, Ferguson, Arm… these aren’t marginal businesses. They’ve either moved or chosen to list abroad altogether.
Even that isn’t the end of it. Another worrying trend is what’s happening beneath the surface. The UK market is being steadily picked off. It genuinely feels like almost every week another listed company is either being bid for or openly discussed as a target.
Often it’s overseas buyers. Often it’s private equity. Always it’s opportunistic. Just in 2026 alone you can run through the names – Schroders, Senior, Tate & Lyle, Intertek, easyJet, Beazley, Bodycote, Evoke, Advanced Medical Solutions. That’s a huge chunk of the market touched by bids or bid speculation in a very short period of time. If you step back, the numbers reinforce the story. In 2025, there were 56 firm offers and 129 distinct bid situations. That tells you everything. This is not a stable market – this is one that is being actively dismantled.
Brexit hasn’t helped – I don’t think many would seriously argue otherwise. But it’s probably not the whole story. There was, in theory, an opportunity post-Brexit to reposition the UK as a more dynamic, competitive, globally oriented market. More flexible listings, more founder-friendly governance, faster regulation. But in reality, that opportunity hasn’t really been taken – or at least not convincingly.
The counterargument is always the same: COVID, Ukraine, geopolitical risk, inflation, energy shocks. All true – but all global. None of those are UK-specific. In fact, if anything, you could argue the UK should have been relatively well positioned.
We have a market heavy in energy, resources, financials – exactly the sectors that should benefit from inflation and commodity disruption. We’re more “value” than “growth” as a market structure. And yet, despite that, there’s been no real revival. UK equities still trade at a persistent discount to US peers. That’s the key point. Everything else flows from that.
There’s also a wider issue that’s harder to quantify but easy to observe: the lack of renewal. There are no real new champions coming through. The top of the market looks very similar to how it did 10 or 20 years ago. Compare that to the US – or even elsewhere. Japan, for example, has seen real reshuffling at the top. Meanwhile the UK… feels static. When the UK does produce a global tech success story, like Arm – it lists in the US. That probably tells you more than anything else.
What happens next? Is there any realistic path to improvement?
Left to its own devices, the outlook doesn’t look particularly encouraging. The UK equity market has already shrunk significantly. You’ve gone from roughly 2,000 names in the All-Share in the early 2000s to about 540 today. That’s not a cyclical move – that’s structural. The obvious question is: why should that trend reverse? What actually makes the UK an attractive place to list right now? Demand is weak.
UK pension funds have spent years de-allocating from equities, driven by regulation and liability matching. We’ve hollowed out one of the natural buyer bases that historically underpinned the market and underpins many other regional markets. Culturally it’s different too. The US has a deep-rooted investing culture. Retail participation is high, and people generally understand – or at least engage with – equities. In the UK, that just isn’t the case. Most people couldn’t tell you what they own in their pension.
And beyond demand, the structural issues are obvious:
- Not genuinely founder-friendly yet
- Limited liquidity in key sectors
- Declining research coverage (MiFID II didn’t help)
- No clear tax or regulatory edge
Even relatively smaller markets, like Sweden, manage to sustain a vibrant, entrepreneurial equity ecosystem. The UK, for all its history, currently doesn’t.
Can anything actually be done?
In theory, yes. In practice, it’s much harder.
You can list out the solutions:
- Stop the leakage of listings
- Improve liquidity (easier said than done)
- Rebuild research coverage (hollowed out post MIFID 2)
- Encourage entrepreneurial growth companies to list locally
- Modernise governance properly (not half-measures)
- Introduce meaningful tax or regulatory incentives
But most of these are incremental fixes. The real issue is deeper: domestic demand for equities in the UK is structurally weak. Until that changes, the rest probably doesn’t matter. At the moment, it doesn’t feel like this is particularly high up the priority list for policymakers (whoever is in charge). Which maybe explains why the situation, despite being widely acknowledged, hasn’t meaningfully improved.
