Cac 40: IPOs in Paris and around the world looked (very) grim in 2023

(BFM Bourse) – After an already difficult 2022, the global IPO market did not recover in 2023. Amounts collected on the Paris Stock Exchange have not exceeded 300 million euros since the beginning of the year.

2022 was a year to forget on the IPO front. Hopes for a resumption of operations in 2023 were high. Unfortunately, this scenario did not materialize at all, according to the latest data from EY, which speaks of a “contrasting year”.

In 2023, the number of IPOs below 1,300 transactions fell to 1,298 worldwide, representing a total of $123.2 billion. This activity is down 8% in volume and 33% in value compared to the $179.5 billion raised in 2022.

Remember that last year, the number of operations collapsed by 45% to 1,333 due to a macroeconomic and geopolitical context that did not encourage companies to rush to the stock market.

Best in Asia Pacific

Going back to 2023, Asia Pacific saw 732 IPOs totaling $69.4 billion, down 18% in volume and 44% in value.

On the other hand, the US market is showing better resilience, EY notes, with 153 transactions for $22.7 billion, up 15% in volume and 155% in value. It must be said that Wall Street was revived by large-scale operations, especially in September and October with Arm, the British microprocessor designer, whose IPO was more than noticed. The entry of the British flagship then represented the largest IPO in the world since November 2021 and the arrival of electric vehicle maker Rivian on Wall Street, valued at $77 billion at the time.

Arm primarily preferred to launch in the United States rather than its original location in London. It’s also the choice favored by Birkenstock, the German sandal specialist founded in 1774 that has fetched around $1.5 billion on Wall Street.

Bad vintage in Paris

And how is the market in Paris? It will once again be a year to remember, as only 6 companies tried their luck this year for a total of $291.3 million, explains EY. Which represents half as many transactions as in 2022, a year that was already not a good year for the top IPO positions in Paris.

This year’s IPO ball is very likely to be closed by explosion risk protection specialist Stif, whose offer result will be known on Friday evening.

Before Stif, the latest operation dates back to July with the arrival of natural ingredients specialist Vinpai on Euronext Growth. This flagship for SMEs hosted all the shows for 2023, the 5th.

On the other hand, it’s simply a blank year in the regulated section of Euronext Paris. Since Lhyfe’s IPO in May 2022, no public offering operation has been recorded. In October, Planisware was well on its way to unblocking this desk and integrating Euronext Paris’s A section – reserved for capitalization of more than €1 billion – which has not seen a new since October 2021 from OVHcloud, the European leader in cloud computing services.

However, the software publisher suddenly changed its mind a day before the IPO, citing adverse market conditions.

American cosmetics specialist Coty, in turn, favored Euronext’s professional division to offer a double offering in Paris (excluding New York). This specific section offers flexibility to foreign companies wishing to acclimatize to the Paris market by allowing issuers to admit their securities to the regulated market without issuing or selling to the public as of 2017.

IPO renewal in 2024?

What will be the trend for 2024? EY is optimistic and believes that appetite for IPOs remains high, “driven mainly by the momentum of smaller transactions”.

“While many governments are taking steps to strengthen financial markets, activity is particularly strong in Japan, India and the US market. Faced with a stabilizing monetary policy, equity market participants could prepare for more favorable windows for 2024,” explains Franck Sebag. , partner at EY.

Some companies have expressed directly or through the press their intention to go public next year. Ultra-fast fashion juggernaut Shein is considering listing on the New York Stock Exchange, the American press reported at the end of November. The operation, considered “the most important in recent years”, is expected in 2024.

In an entirely different field, social network Reddit is also considering an IPO and would be at the head of a cohort of candidates “testing the waters,” Bloomberg reported. Skims, Kim Kardashian’s clothing company, is also exploring possible options, including an IPO, Bloomberg added.

In France, the groups could also take their first steps on the stock market in 2024 through a split. Renault still intends to list Ampere, its subsidiary dedicated to electricity, in the first half of 2024. But the operation will not be carried out under any conditions, the diamond brand recalled in mid-November, referring to the valuation that could be assigned in Ampere. Its CEO Luca de Meo said the group is targeting a valuation of 8 to 10 billion euros.

Sanofi, another CAC 40 company, announced at the end of October its decision to spin off its Consumer Health division, which includes products for allergies, colds, coughs, diarrhea, constipation, etc. This will include an IPO of the entity, an operation that will take place no later than fourth quarter of 2024.

On the SBF 120 side, Sodexo will also be demerging the business through an IPO. The catering specialist plans to take its restaurant voucher and gift voucher business public next year. And he renamed it “Pluxee” in preparation for this future split.

Pathé aims to enter the Paris Stock Exchange by 2024, Jérôme Seydoux reported for Les Echos in September 2022. The dean of French cinemas founded by the Pathé brothers in 1896 thus wishes to attract new shareholders to finance major investments in rooms and content.

Sabrina Sadgui – ©2024 BFM Bourse

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