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IPO gold rush: 2014 listings set to smash records

IPO gold rush: 2014 listings set to smash records

Research from Capita Asset Services shows London's IPO market is on course for a record 2014.

By the end of August the UK main market had raised £7.4 billion. Capita said if it keeps up its current rate, flotations could raise £11.7 billion, smashing 2011's £8.7 billion record.

On the junior AIM market there have only been 55 IPOs, well below the record 325 in 2005. However, the average raised by this year's new boys is £32 million, the highest since records began.

Consumer facing companies have fuelled the IPO frenzy, with one in every three floats operating in the consumer goods and consumer services sector.

The £1.35 billion AA float was the largest, with Saga (£550 million), Pets at Home (£464 million), Poundland (£375 million) and Zoopla (£352 million) helping lift the total raised by homegrown consumer companies to £4 billion.

Commenting on the findings, Justin Cooper, CEO of Shareholder Solutions, which is part of Capita Asset Services, said: 'The IPO gold rush in the first half of 2014 came hot on the heels of a sharp upturn in share prices, as the stock market soared at the end of 2013.'

However, Cooper pointed out that those hoping to come to market in the latter half of 2014 are having to contend with a cocktail of flat markets, weak earnings and poor dividends.

'With a number of IPOs failing to meet expectations, enthusiasm amongst fund managers is lower than at the start of the year, and has allowed them to be more discerning as they approach the offers on the table.'

'[But] that said, the economy is strong, and continuing to strengthen, and there’s still a steady stream of private owners looking to exit their business.

Cooper added: Rumours resound about a potential listings of challenger bank Aldermore and telecoms giant EE among others, joining a healthy pipeline of companies gearing up to make themselves available to UK shareholders.

'If these all come to the market in the next year we could see the total raised by IPOs across the exchange come close to £30 billion in 2015, comfortably above the records set in 2006.'  

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