Stock market IPOs up in the US and down in Europe

Observer

4 days ago

Worldwide, there were 539 stock market flotations in the first six months of the year, but despite Ireland's economy being generally strong within the European Union – particularly in terms of GDP per capita which is second only to Luxembourg – none of them in Ireland, even though new incentives were introduced in Budget 2025.
The global IPOs raised $61.4 billion, a 17 per cent increase in value year-on-year, according to a new report by EY. It says that while there were no new listings in Ireland, investor sentiment remains positive.
'While Ireland has not seen IPO activity so far this year, the fundamentals remain strong. Investor sentiment is holding firm, and the pipeline of potential listings is healthy,' said Fergal McAleavey, a corporate finance partner at EY Ireland. 'Continued market stability will be key to unlocking that potential.
America is leading the way in the number of flotations, with 109 so far this year, its best first-half performance since the peak in 2021. EY's Global IPO Trends report notes that cross-border listings are at a record high in the US, with almost two-thirds coming in from foreign countries. Companies from China and Singapore are 'leading the charge'.
'The US market's appeal stems from its deep capital pools, broader investor base and strong liquidity,' the report says. 'International issuers particularly value access to investors with an appetite for profitable, growth-oriented companies.'
Europe, by contrast, experienced a notable slowdown in IPOs, with most of the big markets pausing following the turmoil set off by US president Donald Trump's announcement of reciprocal tariffs in April.
The continent recorded just 50 IPOs, a 15 per cent drop year-on-year. Sweden was the only exception, with the Asker Health Group's IPO valuing at about 2.3 billion euros. China accounted for one in three of the global IPOs by value, surpassing the US in that category. India was the second most popular, with 108.
The Irish Government introduced two measures in Budget 2025 to encourage investment, including a corporation tax deduction for expenditure incurred in listing shares of a company on any stock in the European Economic Area.
McAleavey said this would be a 'nice benefit' for anyone who had decided to list, but not enough on its own to persuade them to do so. He said the attraction of the US, over Europe (which includes Ireland) was in its high level of liquidity, helped by a strong retail market, which resulted in companies being valued fairly.
He pointed out that Irish companies can now raise hundreds of millions from private equity funds, which has made that route more attractive.
A spokesman for Euronext, which runs the Irish stock exchange, said the introduction of a tax relief for IPO expenses was a welcome development, especially for smaller companies that would be the target for its new 'Access' market.
'Given market conditions, although we have a pipeline of potential IPO candidates, IPO activity is muted globally but we expect to see some activity when market conditions improve,' he said.
Euronext has put forward a number of proposals for this year's budget, including a stamp duty exemption on the trading of shares in companies with a market valuation of less than one billion euros, and to increase the life-time limit for the Capital Gains Tax (CGT) entrepreneur relief by a further one million euros to two million euros.
It is also proposing the creation of an incentivised savings and investment account scheme for Ireland, and an Irish Equity Market Growth Fund to provide equity finance to companies listed or intending to list, on Irish markets. (The writer is our foreign correspondent based in the UK)