Trust, Turbulence, and Transformation: Navigating the UK IPO Market’s Comeback

As all eyes remain on the London IPO market, and whether 2025 will be the year of revival, we asked the experts what they thought the next 12 months might hold. 

Q: Why has the UK market for IPOs been effectively “closed for business” in recent years?

Andy Brough, Head of the Pan-European Small and Mid Cap team, Schroders

The IPO market has been closed due to the fact that trust has broken down between buyers and sellers.

Delphine Currie, Partner European and Middle East, Reed Smith

Global macroeconomic and geopolitical issues, from Russia’s invasion of Ukraine to conflict in the Middle East, have created instability, leading to a "flight to quality" which is benefiting large companies over smaller ones and complicating the backdrop for IPOs.

The UK market faces additional challenges from Brexit, a damaging mini-budget, and unattractive regulations, causing a decline in IPOs and companies choosing to list elsewhere.

Private equity funds also have a lot of fire-power at the moment and many founders seeking an exit are choosing the private route rather than throwing themselves to the mercy of the public markets.

Shannon Nicholls, Managing Director Equity Market Solutions, Rothschild & Co

While the market has been less active it has not been completely closed for business, as highlighted by successful IPOs such as Raspberry Pi, Applied Nutrition.

Muted deal volumes in London mirror those seen in most mature global markets with European and US exchanges showing the same trend.  However, a significant program of capital market reforms has enhanced the competitiveness of London against other global markets and more is in progress.

In the main however, companies for whom London is the natural listing venue, have simply not been ready to IPO in recent years but we see that changing, with an attractive pipeline now building into 2026 and beyond.

Q: What needs to happen for the market to reopen?

Andy Brough

For the market to reopen, trust has to be restored, and everyone has to leave the party with a balloon. By that, I mean all parties have to make money.

Delphine Currie

For the IPO market to recover, a period of macroeconomic and geopolitical stability is crucial, as recent trade tariffs have already caused IPO delays.

Secondly, the UK needs to continue its regulatory reforms to better compete with international exchanges, as the revised listing rules are showing early positive signs.

Finally, ongoing regulatory changes in 2025, including prospectus regime updates and AIM's review, could further improve the UK's attractiveness for listings.

Shannon Nicholls

The market is already open and there are a number of shifting dynamics that we feel will positively improve asset flows going forward.  The key one is that there is a dynamic in the private equity universe which should see some assets unlocked and come to market as funds expire, assets become too big, there is insufficient PE dry powder, return hurdles are hit etc. 

More deal flow, especially where it is well executed, will also bring greater confidence and momentum back into the primary markets.  Furthermore, we expect to see positive governmental and market driven initiatives, such as enhancement of the Mansion House compact, pension reforms, ISA reforms, investment incentives, etc, that will help to bring incremental capital into the listed equity markets, which will support further positive sentiment shifts

Q: What is your outlook for the UK IPO market in 2025?

Andy Brough

2025 will be challenging but the first few out will get a better reception than the last few.

Delphine Currie

Cautiously optimistic! I think the relaxation of the listing rules will see a continuing trend of step-ups from AIM to the Main Market. 

In terms of new listings, difficult years are often followed by boom years as IPOs which have been on ice rush to list once more benign market conditions prevail.  The early part of 2025 gave cause for optimism, but the recent wobble in the markets caused by the imposition of global trade tariffs is concerning.  It’s a real rollercoaster and market professionals in London will be holding their breath to see what happens next in this respect! 

Shannon Nicholls

The pipeline is building well, certainly for 2026 and beyond, and we may see some of that accelerate into late 2025 if there is a period of geopolitical and economic stability.  There is still plenty of activity and discussions, with execution pushed out to later this year and next following the recent market volatility.  Once there is some more certainty, IPO market volumes will grow quickly – it always does!

Q: What would your advice to companies thinking of coming to market in 2025 be?

Andy Brough

If you are going to come to the market, then price your shares at a price that you would be happy for your family to buy them.

Delphine Currie

Even in tough IPO markets, strong companies with a solid track record and business case can still list, but realism is key for those less established. For IPO-ready candidates, choosing an experienced advisory team and thorough preparation are crucial, including realistic valuation expectations and founders demonstrating long-term commitment. Despite recent market inactivity, institutional investors have capital to deploy for compelling investment opportunities with agile management teams ready to seize the right moment.

Shannon Nicholls

Companies looking to IPO later this year should ensure preparation is comprehensive and they are taking good advice around valuation feedback and how to time the market windows.  Knowledge is power – extensive investor education and engagement will ensure good companies are able to access the market once the backdrop is more constructive.