Airtel Money’s £5.3bn London debut in October lifted hopes of an IPO revival, but the private equity firms that own much of the potential supply have plenty of ways to sell without a listing.
UK IPOs have been thin on the ground for years and, with the Budget approaching, managers are hoping the market can be revived. An optimist who sees the pipeline half full is Job Curtis, lead manager of the City of London investment trust.
“A lot of companies have been taken into ownership by private equity firms in recent years and those firms like to sell them at some point to realise their gain,” he said.
“I think we will see more IPOs and we’re already beginning to see one or two come to the London market. So I’m not too worried.”
The most recent example of a company listing on the main London market is African mobile financial services business Airtel Money, which listed on 9 October. Its £5.3bn flotation is the fifth biggest on the London Stock Exchange in 30 years, excluding International Main Market listings, according to AJ Bell.
It is also the ninth most popular IPO ever on the broker’s investing platform, ranked by the number of customers applying for shares. Its majority shareholder is Airtel Africa, a FTSE 100 company, so this was a listing carved out of a listed parent.
Dan Coatsworth, head of markets at AJ Bell, said that unlike many new listings in the UK or US, Airtel Money is profitable, with $1.35bn of revenue and $676m of adjusted earnings in the year to June 2026.
“The long line of retail investors who applied to buy shares in the offer sends a positive signal that the UK stock market is not slowly fading away,” he said. “If anything, Airtel Money’s IPO suggests the UK could now be waking up from its slumber.”
But many other companies are holding back. Guy Anderson, co-manager of the Mercantile Investment Trust, said his team often holds “early-look meetings” with companies ahead of an IPO, where a company meets prospective investors before it comes to market. Quite a few of those companies have come round to the idea of listing, he said, but keep postponing.
“They consistently delay, because they’re looking for that Goldilocks moment when it’s the perfect time to list,” he said. “And of course, with various macro factors and exogenous shocks, we haven’t had one of those [IPOs in our fund].”
There have been 10 major IPO reforms in the past five years, including changes to listing rules and prospectuses, the documents that describe a company to prospective buyers of its shares and stamp duty relief for companies in their first three years on the market.
“There is no silver bullet, obviously, but those incremental changes should make the UK a more attractive destination,” Anderson continued. “And of course, we need the depth of investor base to buy those companies when they come to market.”
Julia Hoggett, chief executive of the London Stock Exchange, said the main market’s listing rules are written by the Financial Conduct Authority, not the exchange, and were overdue for change.
“They probably should have been changed about 15 years ago, because companies that were high-growth, acquisitive and IP-based were not really eligible to list on that market very easily until we changed the listing rules two to three years ago,” she said.
“And then companies had one hand tied behind their back in terms of the freedom of manoeuvre they had once they got to the market. If you’re trying to compete with private equity or the private market for an acquisition, for example, and you have to go out for a shareholder vote for six months, the deal gets done over WhatsApp. You’ve missed it.”
That private market also gives its owners other ways to sell. Richard Hickman, managing director of HarbourVest Global Private Equity, said trade sales, where another company buys the business, and secondary transactions, where stakes are sold on to other investors, are other exit routes that avoid IPOs.
Neuberger Private Equity Partners has no direct exposure to any of the recent IPOs, said Luke Mason, a principal at the firm. But it has announced $150m of realisations (sales of holdings) so far this year and momentum has been building since the second quarter.
HgCapital Trust* sold GTreasury, a treasury management software business, to Ripple at a 97% uplift to carrying value, the price at which Hg had held it in its books. Ripple is a strategic buyer, meaning a company buying for its own business rather than a financial investor. The trust also sold Intelerad and Quantios.
Andrew Carnwath, lead manager of CT Private Equity Trust, said: “Private equity also provides access to a range of businesses that investors increasingly cannot reach through public markets alone. Many attractive growth businesses are remaining private for longer, and some may never choose to list.”
Whether a company stays private or comes to market is a case-by-case decision and candidates for both routes are already in view.
Mason said 2026 is “developing into one of the stronger years for realisations we’ve seen recently, with a good pipeline of exit-ready businesses across the portfolio”.
On the listing side, Coatsworth named three possible listings. Superdrug could appear later this year or next, with its parent AS Watson thought to be considering a dual London and Hong Kong listing. Waterstones would be a candidate if rumours of a London IPO prove correct. Spanish miner Abenojar Tungsten is preparing to join the UK market by the year-end, with production hoped for in 2029.
* HgCapital is a shareholder in FE fundinfo.