PE-backed IPOs in Europe are down dramatically from last year—by over 90% according to PitchBook data. This is due to a toxic mix of macroeconomic and geopolitical uncertainty as well as bad experiences from those companies that did float last year.
The fall-off in IPOs from 2021 is partly due to the fact that pent-up activity created by pandemic lockdowns led to outsized deal volume. Nevertheless, 2022 is on track to be the worst year since the peak of the European sovereign debt crisis in 2012.
While the factors behind the decline in IPOs aren’t the same as in 2012, PE firms are less confident they can achieve an attractive valuation for their portfolio investments via the public markets.
One exit that seemed to buck the trend this year was Vår Energi—a Norwegian joint venture backed by energy giant Eni and PE firm HitecVision—which listed on Oslo’s stock exchange in February.
Unlike many companies that floated last year, Vår Energi is trading well above its offer price. Given the conflict in Ukraine and the strain it is putting on the global energy supply network, investors are eager to gain exposure to oil.
Featured image by MOZCO Mateusz Szymanski/Shutterstock
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