Recovery for European IPOs Unlikely before Q2 Next Year

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Byline: Shanny Basar

The slowdown in the volume of European initial public offerings has worsened over the last few months and the IPO market will not recover before the second quarter of next year, according to PricewaterhouseCoopers.Tom Troubridge, head of PricewaterhouseCoopers London capital markets group, said: "Given current market conditions we do not expect companies in the pipeline to attempt an IPO much before the second quarter of next year. With the equity market effectively closed for new IPOs, companies are seeking alternative finance and debt markets including securitisations are relatively more active."

The total amount raised from European IPOs in the last quarter was [euro]1bn, a massive drop of 80% from the [euro]5.1bn raised in the same quarter last year, according to the PricewaterhouseCoopers survey. The report said: "Although this is partly explained by the high value [euro]3.7bn ($3.6bn) flotation of Friends Provident this time last year, the fact that the level of new offerings over the last quarter was at its lowest for many years, shows the extent of the market slowdown."

The total raised in the last quarter was largely from two IPOs - the [euro]406m flotation of Burberry, the UK fashion group led by Merrill Lynch and Morgan Stanley, and the [euro]333m IPO of Italian utility ASM Brescia. …