UK 's best opening quarter IPO performance in 14 years - EY
UK 's strongest IPO performance in 14 years - EYUK listings experienced a very strong start to the year with more funds raised in the opening quarter of 2021 than in any other opening quarter since 2007 - and the most raised in a single quarter since 2014.
The latest IPO Eye from EY reveals both the main market and AIM have built on the resurgence of activity seen in the second half of 2020, with 12 IPOs raising £5.2bn on the main market and eight IPOs raising £441m on the Alternative Investment Market (AIM).
First quarter fund raising achieved a total of £5.6bn, more than half of the £9.4bn raised in the whole of 2020.
Total funds raised in 2021 's first quarter were the largest of any opening quarter since the £5.8bn of new money raised in 2007* and the most raised in any quarter since the £6.9bn raised in the second quarter of 2014.
The performance during the first three months of 2021 is in stark contrast to the same period in 2020 when there were just three IPOs on the main market and two on AIM, which raised a combined total of £615m - a value nine times lower than this year 's opening quarter.
Scott McCubbin (pictured), EY partner and UK&I IPO Leader, said: “The UK has had the strongest opening quarter for IPOs for 14 years, with the markets successfully weathering the effects of Brexit and bouncing back from the stall in activity caused by the onset of the pandemic a year ago.
“With an effective vaccine rollout underway, momentum and confidence in the UK IPO market should continue to build, but future growth may vary depending on the sector. ”
In addition to IPO activity, follow-on activity has also been strong in the UK with existing issuers raising more than £9bn ($12.4bn) in the first quarter of 2021 - this is 25 per cent of total follow-on funds raised in EMEIA in Q1 2021.
Confidence in the UK 's IPO markets as an exit route has been reinforced by the significant Private Equity (PE) activity in the quarter. Three PE-backed IPOs (the same number as in the whole of 2020) were responsible for 41% of funds raised in Q1 2021, with the biggest, Dr Martens, raising £1.5bn.
The first quarter of 2021 also saw the release of the findings of the Government-backed Hill Review of the UK listings regime, with a view to ensuring the UK markets remain competitive on the global stage.
The first recommendation is currently out for consultation by the Financial Conduct Authority. In the first week of the second quarter, the UK hosted its biggest tech listing on record.
Global IPO markets have had the best start to the year in over 20 years with more than $65bn being raised in over 300 IPOs.
This excludes US-focused Special Purpose Acquisition Company (SPAC) listings which have also been extensive in the quarter with around 300 SPACs raising over $90bn - compared to some $80bn in the whole of 2020.
Technology sector IPOs have led the way globally, with NASDAQ being the leading global exchange, hosting 46 IPOs and raising over $18bn in the process.
The UK has maintained both its position as the leading listing location in Europe for fund raising and, on a global basis, remains in third place behind the US and China for funds raised via IPO.