The Credit Crisis: A Dark Cloud Over Europe’s IPO Markets
As the credit crisis continues to spread its dark wings across Europe, the IPO markets are feeling the pinch. In September, the total IPO volume in EMEA markets plummeted by a staggering 91% compared to the same month last year, with a meager $524 million raised, according to Dealogic.
The European stock market has been hit hard by the credit crisis.
The credit crisis, which started in the US subprime mortgage market, has now spread to other markets, causing investors to become increasingly cautious. Many investment banks that were expecting a flurry of listings from Russia and the Middle East after the summer break are now rethinking their strategies.
‘Many people who participated quite actively in ECM transactions in the first half of this year, after what has happened over this summer, would be a lot more cautious in terms of the amount of money they commit to new issues,’ said Jeroen Berns, ABN AMRO Rothschild’s European head of equity capital.
The IPO market is not dead, however. Italian renewable energy firm Fri-El Green Power has started pre-marketing a 200 million euros IPO, arranged by Merrill Lynch and UniCredit. Engineering group Maire Tecnimont is also planning to launch a 600 million euros IPO, arranged by Lehman Brothers later this month.
The IPO market is still alive, but it’s a challenging time for investors.
In this uncertain environment, investors are looking for safer havens. ‘The IPO market is not going to dry up, we are still interested in non-financial sectors such as green tech,’ said a London-based fund manager.
As the credit crisis continues to unfold, one thing is certain - the IPO markets in Europe will continue to face challenges. But with investors looking for safer options, there may still be opportunities for companies to raise capital.
The European economy is facing a tough time, but there are still opportunities for growth.
In conclusion, the credit crisis has cast a dark cloud over Europe’s IPO markets. But with investors looking for safer options, there may still be opportunities for companies to raise capital. As the situation continues to unfold, one thing is certain - the IPO markets in Europe will continue to face challenges.
