Much has been written in the last number of months about the struggles stock exchanges in the UK and Ireland have had in both attracting IPOs and retaining listings. Companies such as Flutter and CRH grabbed attention when plans were announced to move their primary listings to New York. The US is often seen as a more friendly environment for companies looking to expand their investor base. With less risk aversion and strong participation from retail investors, companies have a greater opportunity to raise capital across the pond.
However, the level of IPOs has decreased in the US also. Data from S&P Global shows that the US market saw 149 IPOs in 2022, with the aggregate amount totalling $20.79 billion. In the previous year, the market saw 908 IPOs worth a total of $282.66 billion. The last decade has also seen a significant boom in private capital markets which has coincided with extremely low interest rates. In private markets, companies can attain financing without facing the strict regulations that accompany the scrutiny of being publicly listed. However, over the last 12 months deals in private markets have slowed significantly, owing to harsher lending conditions in the face of higher interest rates. The prospects of different markets remain uncertain and has become an important input into asset allocation decisions for investors.
As always, if you wish to discuss anything in further detail, please do get in touch.