Global IPO activity in 2014–2015 showed signs of recovery but uncertainty persists

The volume of global and specifically European IPO activity over the last two years has bounced back from the lull experienced across the globe in 2012, and 2014 was a notably strong year. However, the IPO market dropped off again in 2015 which saw $175 billion raised through IPOs from 744 issuances, well below the level seen in 2010, when there was a five-year high of $257 billion raised and 896 issuances completed.

Commenting on the research, Faisal Kanth, Managing Partner at Fairvue Partners, said:

“The level of IPO activity across any market is undoubtedly a key indicator of investor appetite and demonstrates the nature of the sentiment within the broader capital markets. Whilst the IPO market globally has recovered from the dip witnessed in 2012-13, there continues to be significant uncertainty across all regions, with pockets of heightened activity at times when market conditions are favourable. This increases the need to understand the market environment into which any proposed IPO would take place, and establishing an Investor Relations function in-house at an early stage ensures a high level of preparedness, lending invaluable support to the IPO process, as well as ensuring strong trading post issuance.”

Europe accounted for 36% of the global IPO market by value in 2015, increasing from 12% in 2012

Understanding the market environment into which a proposed listing would take place is a key step towards the strategic investor relations planning that will support the success of an IPO.

In this paper, we assess the European IPO market within a global context since 2010, addressing the questions of deal size, investor appetite across sectors, seasonality trends, regional dynamics, and post-listing share price performance. In all, over 4,000 issuances from the past six years have been analysed in this paper, between them raising over $1 trillion upon listing. The analysis drills down into the composition of this growth, highlighting the sectors and regions that have seen the greatest levels of activity and determining where macro factors, particularly regional and commodity price weaknesses, have had a substantial impact on both the timing of listing and initial returns.