Target audience for European IPOs is shrinking
The ratio between offerings that got away and those that failed in the last half of 2019 is uncomfortably close
It’s easy to announce an initial public offering (IPO) in Europe, but far harder to complete it. Don’t be distracted by the handful of decent-sized share issues launched in January. The recent evidence suggests that the target audience for European IPOs is smaller, fussier and harder to reach than it used to be.
About 17 offerings totalling €1.4bn were unveiled in January on European bourses. Look at how deals fared in the second half of 2019 and it’s hard to be confident that they will all reach the finishing line. Fourteen IPOs worth more than €100m debuted in the last six months of 2019 (ignoring investment companies), Bloomberg data shows. But nine were pulled. That’s an uncomfortably close ratio between offerings that got away and those that failed. Glance at the US in the same period, or Europe in the preceding six months, and deal failures such as WeWork were vastly outnumbered by successes such as Nexi...
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