Having stalled for a number of years, London’s IPO market is once more on the move. Following a record-breaking 2021, flotations on the London Stock Exchange (LSE) all but dried up. But the taps are slowly being turned on. A string of successful mid-cap listings over the past 12 months and a growing pipeline of potential issuers suggests that the market is regaining its appeal.
Overall, UK IPO deal volumes lag behind their continental peers. This is because the past 18 months have seen a dearth of large private equity-backed listings in the UK, while Europe enjoyed several flagship jumbo offerings. Against this backdrop, it is easy to forget that the stuff which has come to market in London has largely performed well. A number of mid-cap, often founder-led, firms have priced and traded strongly, outpacing the average IPO performance in both Europe and the US.
That momentum is likely to build. Indeed, we expect a broader reopening of the UK IPO market after the summer break and into 2026. Market volatility in the second quarter has delayed some launches. But investor appetite remains intact and the recent market rebound has been helpful for sentiment. We are running a number of early-stage pre-marketing processes that are being met with encouraging interest from investors who want to see the firms come to market.
Several challenges remain for potential issuers. Domestic UK funds are suffering from persistent outflows and selectivity remains high. A compelling equity story, credible growth trajectory, and early engagement with investors are all important to help mitigate these risks and set an offering up for success.
A question that remains front of mind for many large, international businesses is where to list. While many high-profile defections to New York and Amsterdam have made headlines, the pendulum is swinging back. Numerous international companies have recently listed in London or are preparing to do so.
Three factors are driving this shift. Firstly, the LSE’s updated listing rules have levelled the playing field with other exchanges. Secondly, international issuers have performed poorly in the US, with investors there favouring domestic assets. And finally, geopolitical uncertainty—including tariffs and elections—is casting doubt over other markets. After a long difficult period, politically and economically, the UK looks like a relatively safe bet.
For companies considering a flotation, early preparation is key. The IPO process typically takes six to eight months. But early groundwork can make all the difference. Identify any potential ‘red flags’ with the accountants and lawyers to get IPO-ready internally. From there, engagement with investors early, even ahead of the formal IPO process, helps to build important relationships and identify future shareholders.
Although the UK’s IPO engine may not yet be roaring, it is no longer stalled either. If the recent market recovery continues, the second half of the year could see a meaningful uptick in activity. For issuers with the right story and preparation, London appears to be open for business once again.
Brian Hanratty,
Head of ECM
