Flotations on Europe’s stock markets raised 30 per cent less money in the third quarter than the same time last year, according to PwC, although the accountancy firm predicts a pick-up in activity before the year-end.
China’s August stock market crash sent jitters across the globe, prompted businesses to put their listing plans on ice, PwC said. The company’s quarterly IPO report showed that only 53 flotations raising €4.6bn (£3.4bn) took place in the three months to the end of September, and the €1.2bn float of Deutsche Pfandbriefbank accounted for a quarter of the proceeds alone.
That compared with the same period last year when 76 flotations brought in €6.6bn.
“The last two months have been a slightly hair-raising rollercoaster ride. We have watched the fallout from the Chinese stock market turmoil as volatility indices rose to levels not seen since 2011,” PwC’s capital markets director Vivienne Maclachlan said.
“The decision being debated with investment bankers in many boardrooms across Europe is focused on the timing of launching an IPO and the markets’ receptiveness to new issuers with the key question being - when is the right time to launch?”
The London market was particularly subdued, with just nine listings raising €747m – or 43 per cent less than last year – due to the uncertainty in the run-up to the General Election.
However year-to-date activity remains strong with 258 IPOs raising €35.7bn and PwC expects the market to finish the year on a high, as those businesses that postponed their plans come to market in the final quarter.
Global payments firm Worldpay is being prepped for a £4.5bn float along with car insurance group Hastings, with a mooted value of around £1.5bn.