European IPOs in Q2 fell to lowest level since 2009

Euronext Dublin

The number of companies listing on the stock exchanges of Europe has fallen to the lowest level since 2009, according to the Association for Financial Markets in Europe (AFME).

AFME said IPOs accumulated €1.3 billion in deal value in the second quarter of 2023, the lowest Q2 amount since 2009.

For the first-half total, IPOs declined 42% — also the lowest amount since 2009.

European SPAC IPOs have declined from a peak of €3.2 billion in the second quarter of 2021 to no deals in Q1 of this year and €900 million in Q2 of 2023.

AFME is the voice of Europe’s wholesale financial markets.

“There is a recurring theme of some European companies preferring to list abroad because there’s better liquidity in the US,” Julio Suarez, director of research at AFME, told London’s Financial Times.

“Structurally, US capital markets are more attractive to risk capital,” he said.

AFME managing director Gary Simmons said: “I think it’s getting to the point now both in Europe and the UK [where] people are realising it’s more urgent than it had been in order for these jurisdictions to keep up.”

The details were contained in AFME’s Equity Primary Markets and Trading Report for the second quarter of 2023.

The report provides an update on the performance of the equity market in Europe in activities such as primary issuance, mergers and acquisitions (M&A), equity liquidity structure, and market valuations.
The repoirt’s key findings also included:

  • Equity underwriting on European exchanges for the first half of 2023 rose 28% YoY on the back of stronger secondary equity offerings.
  • Completed mergers and acquisitions during H1 of 2023 declined when measured as announced value (-45% YoY) and when measured as completed value (-46% YoY)
  • Average daily equity trading on European main markets and MTFs stood at €79.9 billionn in H1 2023, a 14% decrease compared to H1 of 2022.
  • According to BigXYT data, on-venue trading represented 72% of the total addressable liquidity in Q2 of 2023. Volume traded off-venues, on systematic internalisers and pure OTC, represent the remaining 28% of the volume of the total addressable liquidity.