London IPO fundraising slumps in blow to UK

Yahoo

a day ago

Fundraising from London's initial public offering (IPO) scene slumped in the first half of 2025, with just nine initial public offerings (IPOs) raising £182.8m ($246.2m), raising questions about the fading allure of the UK as a hub for global capital.
The bleak figures mark a steady decline from the same period last year, when eight IPOs generated £526.7m in H1 2024. The downturn continued in the second half of 2024, with nine IPOs raising £258m, according to data released by law firm White & Case LLP.
London's most significant IPO of 2025 to date came in April with the listing of professional services company MHA (MHA.L), which raised £98m on the Alternative Investment Market (AIM).
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However, the City's ongoing struggle to maintain its position as a destination for high-growth tech listings is evident, as major firms like AstraZeneca (AZN.L) and Wise (WISE.L) explore shifting their listings to the US.
Reports suggest that AstraZeneca's CEO is considering relocating the pharmaceutical company's primary listing to the US, while money transfer service Wise, valued at £11bn, plans to follow suit next year.
Online fast fashion giant Shein has filed for an IPO in Hong Kong as it struggled to gain the go-ahead from Chinese regulators for a flotation in London.
"Shein's listing would have been a boost to the market," Alasdair Steele, corporate partner with law firm CMS, told Reuters. "However, there was never any guarantee that a single large listing would reignite the IPO market."
In February, Unilever (ULVR.L) said it had chosen Amsterdam for the main listing of its ice cream business. That follows a string of London-listed companies that have either moved to a different market, such as online betting company Flutter (FLTR.L) Other major companies, such as Shell (SHEL.L), have considered a move.
Despite these lacklustre figures, the market recently experienced a boost when Norwegian software giant Visma reportedly chose London over Amsterdam for its €19bn (£16.2bn) IPO. This shift comes at a critical time as London seeks to remain relevant amid global competition for tech listings.
London IPO activity could jump from September
Despite the challenges, Jonathan Parry, a partner in White & Case's Capital Markets group, sees potential in the UK capital. "The inherent strengths of London, including its deep pools of capital and liquidity, are often overlooked. As we have seen from high-profile capital raises this year, the London market functions very effectively for companies that have a compelling equity story and a strong management team," he said.
In the face of this mixed performance, UK Public M&A activity has shown signs of recovery. White & Case data shows that Q2 2025 saw a surge in deal volumes, which tripled to 27 deals compared to 10 in Q1 2025.
Furthermore, the total value of these transactions surged 353% to £18.5bn, up from £4.1bn in Q1. This activity was largely attributed to falling interest rates, a stable political and regulatory environment, and attractive valuations on offer.
According to Parry, the growing IPO pipeline should pick up once again if the recent turbulence calms down. "This would mark a much-needed boost for the City and be a helpful reminder that London remains both Europe's preeminent financial centre and its largest listing venue," he said.
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City investment bank Peel Hunt reported that most UK IPO candidates are waiting until September to decide whether to proceed with listings. The firm also said that sentiment around London listings has started to recover following a dip when US president Donald Trump announced sweeping tariffs in April.
In its latest 'IPO Speedometer' report, Peel Hunt stated that the UK IPO market remains "selectively open," with several companies looking at a post-summer "window" to potentially debut on the London Stock Exchange.
"While we are still some way from a fully open UK IPO market, and there has been limited recent transaction activity, we do see conditions improving meaningfully, particularly around the broader equity market backdrop, which has turned from a headwind to a tailwind, and investor sentiment, which is increasingly constructive," Peel Hunt wrote.
UK weighs changes to IPO rules to attract foreign capital
Meanwhile, efforts are underway to streamline London's capital markets. The Financial Conduct Authority (FCA) has confirmed plans to reduce red tape, making it easier and quicker for companies to raise funds. Under new rules, companies listed on the London Stock Exchange will no longer need to publish lengthy prospectuses when issuing additional shares.
Also, the time between the publication of initial documents and an IPO is set to be halved. The FCA's new measures will also simplify the process for corporate bond issuance to retail investors, and a new public offer platform will help smaller growth companies raise capital more easily.
There are also reports that shares in UK-listed companies could soon be traded 24 hours a day under plans from the London Stock Exchange Group (LSEG) to tap into booming demand from night owl traders.
The LSEG (LSEG.L), which owns the London stock market, is weighing plans to launch a 24-hour trading platform, according to the Financial Times. This move is seen as a strategic attempt to boost the appeal of the UK's sluggish stock market and attract both overseas investors and younger traders keen on buying British shares at any time of day.
The shift in trading patterns, particularly in the US, is reshaping how markets operate. In the US, an increasing number of transactions are being carried out outside traditional working hours by a new wave of Gen Z retail investors using smartphone apps. This has left traditional exchanges exposed to competition, as younger, tech-savvy investors opt for more flexible trading hours.
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Cryptocurrency markets, such as bitcoin (BTC-USD) trading, already operate around the clock, making the notion of limited trading hours for traditional equities increasingly outdated. Platforms like Robinhood have also capitalised on this trend, allowing investors to trade stocks during late hours, further adding to the perception that traditional market hours are outdated.
At present, London-listed shares only trade between 8am and 4pm.
These regulatory changes come at a time when companies in the UK are grappling with increasing uncertainty. A report from EY-Parthenon showed that the number of London-listed companies warning of lower profits has spiked. In Q2 2025, 59 firms issued profit warnings, a 20% increase compared to 49 during the same period last year.
EY-Parthenon attributed this rising uncertainty to "rapid and unpredictable policy shifts" that have a "paralysing effect on confidence, decision-making, and spending."