Monday 20 April 2020 12:01 am

Coronavirus: European IPO market 'virtually inactive' since March

The initial public offering (IPO) market in Europe has been “virtually inactive” since March due to coronavirus, however secondary equity raises have spiked as companies seek to shore up their finances during the crisis. 

Only seven public offerings were launched on European exchanges between early March and mid-April, according to the latest research.

European IPOs have raised €26.2m compared to €6.4bn in 2019, a 99.6 per cent drop year on year.

“The current market environment makes it costly for companies to list and raise fresh capital,” the Association for Financial Markets in Europe (AFME) said. 

Only four new listings have been announced since early March, compared to 25 deals in the same period of 2019. 

However, the second equity offering market has remained strong as companies scrambled to raise capital. 

A total of €10.3bn in secondary offerings have been issued on European exchanges just below €11bn issued in the same period of last year. 

In the first two weeks of April there were 52 deals with a total of €4.1bn raised as firms issue equity in an attempt to navigate the Covid-19 crisis. 

AFME found that around  €2.5bn of the €5.6bn capital raised between March and April this year was explicitly attributed to Covid-19, with the majority of equity offerings raised on UK and Swiss exchanges.

Share