London stock market flotations fall to lowest in 30 years

Times

04-07-2025

Capital raised from launching companies onto London's equity market has fallen to its lowest level in 30 years, adding to anxiety over the UK's competitiveness as a global financial centre.
Just £160 million was raised via five flotations during the first half of the year, according to figures from Dealogic, the lowest since the data provider began collating the numbers in 1995.
The stark figures are 28 per cent lower than the £222 million raised during the aftermath of the financial crisis in 2009, the second weakest year on record. They are 98 per cent lower than the first six months of 2021, when London saw a bumper crop of IPOs, including Deliveroo, Alphawave and Trustpilot, many of which have either been taken private or trade below their offer price.
• This is precisely the wrong time to give up on the stock market
The dearth of IPOs was a result of low valuations attached to companies trading in London compared with other markets, which has put off private companies, as well as 'a lack of confidence in a positive outcome, which is important because IPO processes are lengthy and expensive', Charles Hall, head of research at Peel Hunt, the investment bank, said.
Investors pulling money from UK equity funds have diminished the appetite among institutions to participate in IPOs, he said. 'You don't want to put money into the market. Psychologically, it's very difficult to do when you've got a shrinking capital pool. And the other thing that's happening is … more money is going into passive investment and passives don't invest in IPOs.'
However, he said that the investment bank had been having 'a number of encouraging early-look meetings with potential IPO candidates'.
Fundraisings globally rose 11 per cent over the first six months of the year to $60.9 billion compared with a year earlier, led by America where $28.5 billion was raised through IPOs.
The gloomy figures are the latest blow to London, days after The Times revealed that Sir Pascal Soriot, the boss of AstraZeneca, had spoken privately of his preference to move the stock market listing of Britain's most valuable public company to the United States.
Rachel Reeves, the chancellor, is due to deliver her next speech to City grandees at Mansion House on July 15, when she is expected to set out the government's growth and competitiveness strategy for the financial services industry.
Among the mooted reforms is a limit on the amount of cash savers can put into cash Isas each year, a move designed to encourage more people to invest instead and potentially revive the stock market.