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Will the UK IPO slump continue in Q3?

The UK IPO market was once again subdued in the third quarter of 2022, according to research from EY. This continues this year’s slump in new listings as inflationary pressure and economic instability see companies delaying when to go public. Yet, next year could see a rebound and there are some big names that may make a splash on debut.

London’s IPO market looks set to notch up another lethargic quarter, according to research from EY published this month. In the quarter, the six listings on the main market raised £554.5m, while the two listings on AIM raised £11m.  In the same quarter of 2021, there were 14 IPOs on the main market, raising £2.9bn, while the 19 listings on AIM raised £1.1bn.

Scott McCubbin, EY UKI IPO leader, said that “ongoing geopolitical tensions and economic instability, compounded by inflationary pressures, have meant that many businesses have delayed their IPO plans”. The sluggish pace of listings isn’t just limited to UK IPOs. Globally the number of new IPOs reported year-to-date is down 44% compared to the same period last year.

In stark contrast to this year’s malaise, 2021 saw 126 companies raised £16.9bn through IPOs in London — the highest amount raised since 2007, according to UK government data. However, among these were some high profile disappointments. For example, Deliveroo’s [ROO] share price plummeted after listing in March 2021, with the online takeaway business’s stock down 70.44% since listing as of Friday’s close.

Slump in UK IPOs

A dismal third quarter for UK IPOs continues a trend felt throughout 2022. Analysis from KPMG’s UK Equity Capital Markets half-year update shows that activity reduced significantly in the first half of 2022. Eleven companies listed in London during the first half of the year raising £0.5bn compared to the 40 companies which managed to raise a collective £9.9bn in the same period in 2021. 

PWC’s IPO Watch Europe Q2 2022 described the London IPO market as “largely closed” in the second quarter, with a scant three listings raising a collective £0.2bn, down from the £2.6bn raised in Q2 2021. The biggest of the three was SPAC Financial Acquisition Corp [FIN.S], which raised £150m.

Despite the continued slump in the third quarter, EY’s Scott McCubbin said that there is a “healthy pipeline of IPOs” and that he was seeing preparation levels for companies planning to IPO starting to increase.

“We expect listing activity to rebound in 2023 once inflationary headwinds ease, and companies have the stability and predictability required to realise their long-term growth plans,” said McCubbin.

Potential London IPOs in 2023

Arm Holdings

Arm Holdings could be one of the biggest UK IPOs. Owner Softbank [9984.T] is looking to list the Cambridge-based tech firm that focuses on the design of semiconductors after the collapse of a $40bn takeover deal by Nvidia [NVDA]. In June, the Financial Times reported that Softbank was targeting a valuation of $50bn and could pursue a dual listing in London and New York after lobbying from the UK government. In September, Yahoo Finance reported that the UK government once again wanted to enter into talks with Softbank to persuade the bank to choose London for Arm’s IPO.

Starling Bank

Starling Bank CEO Anne Boden said in November last year that the challenger bank could list in the next two years, with London being “the default option, unless we’re persuaded otherwise”, as reported by CNBC. In April, Starling Bank’s valuation more than doubled to £2.5bn after raising £130.5m in a fundraising round. The bank revealed that it had swung into profit with a pre-tax profit of £32.1m for the financial year ending 31 March 2022, up from a pre-tax loss of £31.5m for the same period the previous year.

EG Group

Run by the billionaire Issa brothers, and backed by private equity firm TDR Capital, EG Group has grown from a single petrol station into a global business empire of petrol stations and convenience stores that operates in 10 countries and employs over 44,000 people. In 2020, EG Group bought Asda from Walmart [WNT] for a hefty £6.8bn. In 2019, EG Group considered listing in London with a valuation of £10bn, with Bloomberg reporting in November last year that the firm was once again considering listing.


Revolut is one of the UK’s biggest fintechs and was valued at $33bn after its last round of fundraising. In May, CEO and founder Nikolay Storonsky played down listing in 2022 during a company town hall, according to Business Insider. Reportedly, Storonsky said market conditions were too poor for a listing and that it was likely the company would wait for at least a couple of more years. In September last year, Storonsky told Bloomberg that sales would have to be in the billions before the company goes to market. Revolut reported adjusted revenue of £261m, up 57% year-on-year, in its 2020 full year financial statement.

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