Call it the Friends effect: the UK IPO market is still stuck in second gear and waiting for someone to clap it into action.
Despite flashes of optimism and signs of recovery, the pace of new listings is still a far cry from the heyday of the City’s dealmaking.
Peel Hunt’s latest “IPO Speedometer” reads 27mph, up from 22mph in April. But the LSE still can't get into 'third'.
That means the road ahead is open for flotations, but only for companies with standout credentials or themes that truly resonate with investors. For most, the window is half-open at best (just to mangle the analogies).
After a turbulent spring that saw many deals shelved, the backdrop is improving. The FTSE 100 is trading near record highs, and volatility has faded back to more normal levels.
Investors are showing renewed interest in UK equities as economic indicators firm up and geopolitical tensions ease.
Peel Hunt’s report notes a growing list of companies preparing to launch IPOs after the summer, with the coming autumn expected to be a key test of this cautious new mood.
So far this year, only a handful of IPOs have made it to market, but most that have launched, especially in Europe and the Nordics, have performed well, suggesting real demand exists for the right businesses.
The UK pipeline is broadening, with more private equity-backed and international companies now weighing up London as their destination.
Alongside IPOs, large capital-raising deals are still being snapped up, underlining that the City’s deep pool of capital is available for high-quality stories. For now, though, the market is still selective and moving at a measured pace.
If the current momentum holds, it could finally be 'the month, or even the year' for the Square Mile.