Thursday 15 July 2021 4:22 pm

London records strongest half year IPO performance since 2014

The UK retained its dominance as the most attractive European IPO venue by funds raised, continuing the deal momentum witnessed in the previous two quarters.

Both the main market and Alternative Investment Market (AIM) have built on the resurgence of activity seen in the last two quarters, with 10 IPOS raising £3.1bn on the main market and 13 IPOS raising £664m on the AIM, according to new research from EY.

London also broke a record with its largest ever Alternative Investment Market (AIM) admission in the second quarter of the year, as Victorian Plumbing Group raised £298m upon listing, with a market capitalisation of £850m.

Listing activity across both markets was driven by the technology sector, followed by strong performances from healthcare and life sciences, EY said.

The total funds raised during the quarter were ahead of other European markets at £9bn, bringing the total equity capital raised in London in the first half of the year to £27bn.

Fund raising

London also maintained both its position as the leading listing location in Europe for fund raising and, on a global basis, remained in third place behind the US and China for funds raised via IPO.

Scott McCubbin, EY UKI IPO Leader, said there appeared to be “no let-up in activity in sight” for UK equity markets for the remainder of the year.

“Whilst activity in the tech sector has dominated listings in recent quarters, we are starting to see companies from more traditional sectors consider a return to the public markets as the wider economy recovers from the shock of Covid-19 and this should increase overall deal volumes,” McCubbin said.

“As ever, investors will continue to scrutinise potential issuers with business models, governance and ESG playing a key role in the investment decision.”

Globally, equity markets also flourished as $111bn was raised in 599 deals around the world – making the first half of the year the best six-month listing performance in over 20 years.

Listings of special purpose acquisition companies (SPACs) took more of a backseat after the frenzy witnessed in the last 12 months of the pandemic, with traditional IPOs overtaking as the deal type of choice.

Industries attracting listings reflected those of the UK, with the tech sector accounting for over a quarter of global IPOs, and healthcare issuers coming in second. The two sectors combined accounted for more than half the proceeds raised globally in the quarter.