Overall capital raising in EMEA in H1 2017 increased by 22% to USD 21.9 billion, compared with USD 17.9 billion raised in H1 2016 but has fallen 47% behind the level of capital raised in H1 2015. The volume of activity has fallen for the third year, by 16% to 84 IPOs.

The IPO market decline in 2016 and slow recovery in H1 2017 is attributed to the uncertainty brought by Brexit, declining value of the British pound, and other political uncertainties, which caused companies to pull back from the market in 2016. The lack of roll-over deals from 2016 meant that 2017 started slowly. The IPO pipeline swelled at the end of 2016 following the US elections. Many of these deals completed before the summer, but a significant portion will roll-over into the second half of the year.

Cross-border capital raising accounted for 22% of all capital raised in this region in H1 2017, the strongest level since H1 2013, largely driven by Allied Irish Banks' USD 3.35 billion IPO. This has raised EMEA’s share of global cross-border capital to 39% in 2017. This listing will also be the first Irish company to list in EMEA since H1 2015. However, while the value of cross-border deals increased by 442% in H1 2017 compared with H1 2016, overall market activity in EMEA is weak when compared to other regions.
Despite this, London (Mainboard and AIM) remains as the top destination for cross-border transactions in the region in H1 2017, with eight listings representing 67% of the number of cross-border IPOs in EMEA. With values of USD 3.8 billion, the London markets account for 81% of total cross-border IPO capital raised in EMEA. NYSE Euronext is the second highest with USD 565 million from two IPOs
The Cross-border index in EMEA showed the most promising change in the first half of 2017, after three continuous years of decline. The EMEA index increased by 74% for the first half of 2017, as cross-border capital raising and number of IPOs increased, largely due to the Allied Irish Banks' IPO.
Capital-Raised-by-Cross-Borders-IPOs
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“I’m feeling very positive. 2017 has been a very different year to the disastrous 2016, during which companies and investors sat on the side-lines awaiting the outcomes of the Brexit referendum and the US election. Companies continue to view London as a premium listing venue, with deep liquidity and a rich list of peers and investors.

The greater threat to London is likely to be from overseas competition for listings. The US is signalling a desire to deregulate to make it easier for companies to raise capital in the US. Issuers are starting to take a second look at the US, particularly as the EU is tightening requirements with the Market Abuse Regulations and MIFID II to come.

I see a broadening of geographies in EMEA –and expect to see more IPOs from CIS, Turkey and Middle East. Given this and our view on high level of deals active in various stages in the pipeline we expect a much different level of market activity in the second half of 2017.”
Edward Bibko Head of EMEA Capital Markets at Baker McKenzie
KEY-EMEA-DATA-POINTS
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CROSS-BORDER IPO INDEX: EMEA
CROSS-BORDER IPO INDEX: EMEA
KEY EMEA DATA POINTS
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