The UK IPO market has continued its resurgence throughout H1 2021 with the number of new listings on the London Stock Exchange already exceeding the number that listed in the whole of 2020, shows research from Pinsent Masons, the international law firm.
As of 28 June 2021, 45 companies have listed on AIM and the Main Market and six more say they intend to list this year. That compares to 31 companies that listed in the whole of 2020.
There was more IPOs in Q1 2021 (20) on the London Stock Exchange than in any previous first quarter of the year since 2007.
Companies have been eager to exploit the renewed investor optimism so far this year. Healthcare companies (6), tech companies (11) and online retailers (7) make up 53% of the businesses to have listed so far in in 2021. Companies from those sectors see now as an ideal time to float as, in many cases, COVID has provided a strong tailwind to help their sales growth.
Julian Stanier, head of Corporate Finance at Pinsent Masons says, “This has been the busiest period for London Stock Exchange IPOs for about 15 years.”
“Not every company that is queuing up will achieve a listing; investor appetite has remained strong in H1 but we are beginning to see some signs of indigestion. We are hearing stories that fund managers are fatigued and tiring of so many roadshow meetings. With the much anticipated end of lockdown a few weeks away and summer holidays around the corner, there is likely to be a sharp decline in activity in the weeks to come.”
“The race is still on to get IPOs completed before this summer lull. After that we have a healthy pipeline of IPOs scheduled from September with a number of issuers keen to be straight out of the blocks post the summer break. However we will have to wait and see if investor appetite continues at the same levels post the summer break.”
“The easing of lockdown restrictions in the coming months may also provide companies from the industries hardest hit by COVID to consider an IPO as their “recovery” story becomes clearer. Some of these however may be gobbled up by their healthier peers or PE houses.”