London has dropped out of the world’s top 20 IPO markets for the first time in decades, overtaken by Singapore and Mexico in Bloomberg’s latest rankings. The UK exchange now sits in 23rd place, behind even Oman, after IPO volumes plunged 69% this year to just $248 million—the weakest fundraising haul in more than 35 years.
The city’s largest IPO of 2024, accounting firm MHA’s £98 million listing, highlights the scale of the decline. No major Wall Street banks were involved, with local firms like Cavendish and Singer Capital Markets handling the deals. Third-quarter volumes slumped even further to $42 million, down 85% from a year ago.
London’s diminished role reflects both competition from rival hubs in Europe, Asia, and the Middle East and the exodus of firms seeking higher valuations in New York. Portfolio manager Leonard Keller noted that low UK valuations have discouraged IPOs while making listed firms attractive takeover targets for private equity.
The downturn is stark compared with past highs: London raised $51 billion in 2006, but this year’s total is down 99% from that peak. As recently as 2013, the UK accounted for more than half of Europe’s IPO fundraising; today its share has fallen to just 3%.
Singapore climbed to 9th place this year with $1.44 billion raised, driven by property trust IPOs, while Mexico secured 19th with $460 million—nearly double London’s total.
The shrinking pool of listed UK firms has been accelerated by private equity acquisitions. KKR, Blackstone, Bain Capital, Brookfield, and others have snapped up undervalued companies. Recent examples include KKR’s £4.2 billion purchase of Spectris after a bidding war with Advent. Industry leaders like Rupert Soames warned that while private equity is taking firms off the market, they are not returning them via IPOs.
Authorities have responded with reforms such as easing dual-class share rules and broadening FTSE index eligibility. Still, many high-profile IPOs are choosing Amsterdam, Stockholm, and New York instead. AstraZeneca and Wise are among those shifting their focus overseas, citing deeper liquidity and stronger valuations.
Some optimism remains. Deals such as Beauty Tech Group’s £320 million offering and private equity-backed Visma’s planned 2026 float could provide a lift. LSE CEO Julia Hoggett has pledged to strengthen London’s junior markets and create new venues for private share trading. But for now, London’s pipeline trails its rivals, underscoring the market’s struggle to reclaim global prominence.
Source: Business Times
