Fears for London IPO market as Misys and O2 pull 2016 float plans
London’s stuttering initial public offering (IPO) market suffered more blows today as Misys pulled plans for a float and Telefonica said late on Wednesday it would not be listing O2 this year.
City sources fear that, with investors spooked by Brexit uncertainty, it appears likely that other large deals will be abandoned or pushed back.
Tech giant Misys, which was expected to launch one of the biggest floats of the year in the coming weeks, said in a statement yesterday that it had received “encouraging institutional support”, but “decided not to proceed… at the current time due to market conditions”.
Read more: O2 could IPO as soon as this year
Meanwhile, Telefonica – which previously said it could float O2 by the year’s end depending on market conditions – has now indicated it will not push ahead with the IPO until 2017, when it will only pursue if market conditions are right.
The float plans emerged after O2's failed merger with Three.
It comes at the end of a month in which Pure Gym and TI Fluid Systems pulled flotation plans.
Scott McCubbin, IPO leader at EY, told Morning Wire: “I think what this probably does is it puts off a lot of floats this side of Christmas. I think a lot of companies now, if they were looking to float, they’re probably pushing it into 2017.”
Read more: IPOh dear: Another blow for flotation market as Misys pulls listing plans
Next Monday, medical products firm Convatec is due to float in a deal valuing the company at £4.4bn, which will be the biggest London IPO of 2016.
According to Dealogic statistics, $6bn (£5bn) has been raised on the UK flotation market so far this year, down 50 per cent from $12.1bn during the same period in 2015.