IPO Watch Europe Q3 2018

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1 IPO Watch Europe bn raised in 18 ( 17: 8.3bn, 3% decrease) 4 IPOs in 18 across Europe ( 17: 7 IPOs, 1% decrease) 2.8bn IPO Proceeds raised in YTD 18 (YTD 17: 29.1bn, 11% decrease)

2 Source: Dealogic and Stock Exchanges 2

3 Contents European IPO trends 4 Market volatility Pricing of top IPOs 7 European PE trends 7 The sector story 8 UK focus Overview 9 Relative performance of UK IPOs Global perspective 11 Appendix 12 Contacts 14 Outlook Geopolitical headwinds and the summer hiatus muted activity in, with European IPO values at their lowest levels for 2 years. The pipeline going into Q4 looks relatively healthy as volatility continues to be low and there a number of megaipos expected. That said, the weak aftermarket performance of a number of recent IPOs and the wider uncertainty around the Brexit negotiations may deter prospective IPO candidates from completing a transaction on the public markets before the end of the year. Mark Hughes Partner, UK Capital Markets Leader at PwC 3

4 European IPO trends For the second quarter in a row, the London Stock Exchange is the most active in terms of volume and the largest contributor to European IPO values, representing almost half of all European IPO proceeds raised Figure 1: Top 3 stock exchanges in Europe in 18 (by offering value) Source: Dealogic and Stock Exchanges 4

5 Value of IPOs bn Volume of IPOs Value of IPOs bn Volume of IPOs European IPO trends 18 European IPO values and volumes are below levels seen in 17, however, have recovered from 1, when activity was dampened following the UK s vote to leave the EU Figure 2: European IPO activity YTD September since YTD 08 YTD 09 YTD YTD 11 YTD 12 YTD 13 YTD 14 YTD 1 YTD 1 YTD 17 YTD 18 0 YTD value bn YTD IPOs Figure 3: Quarterly European IPO activity since Q1 Q2 Q4 Q1 Q2 Q4 Q1 Q2 Q4 Q1 Q2 Q4 Q1 Q Value bn IPOs *MegaIPOs are those raising in excess of 1bn Note: Excludes IPOs on Borsa Istanbul, Zagreb Stock Exchange and Bucharest Stock Exchange pre 11 Source: Dealogic and Stock Exchanges

6 % change since 1 Jan 17 Money raised bn VSTOXX0 index Market volatility Volatility remains stable despite geopolitical tensions, however, IPO activity in Europe remains muted Figure 4: Volatility tracked against European IPO values bn+ IPO of Galenica Sante AG 0 Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep 0 Triggering of Article 0 1bn+ IPOs of Allied Irish Bank plc and ALD SA 17 French Presidential election 1bn+ IPO of Landis & Gyr Holding AG UK General election 1bn+ IPO of BAWAG Group AG and J2 Acquisition Ongoing Article 0 negotiations between the UK and EU. North Korea and US tension 1bn+ IPO of Siemens Healthineers AG and DWS Group GmbH &Co KGaA 18 1bn+ IPO of CEVA Logistics AG Fears of rising US bond yields and higher inflation saw $4tn wiped off the value of shares around the world after a correction of the US markets 1bn+ IPO of SIG Combibloc Group AG Figure : Historical performance of major European market indices since January 17 % 1% DAX 30 FTSE 0 CAC 40 IBEX 3 % % 0% % Jan Feb Mar Apr May Jun Jul Aug Sep Oct Nov Dec Jan Feb Mar Apr May Jun Jul Aug Sep Source: Thomson Reuters as at 29 September 18

7 Value of IPOs bn Volume of IPOs Pricing of top IPOs The IPO of SIG Combibloc IPO on the SIX Swiss exchange was the largest IPO this quarter, with the remaining four largest IPOs listing in London Figure : Top European IPOs in 18 SIG Combibloc Group AG Amigo Holdings Plc Tritax EuroBox plc Trian Investors 1 Ltd Hipgnosis Songs Fund Ltd Exchange SIX Swiss London London London London IPO date 28Sep 02Jul 09Jul 27Sep 11Jul Money raised ( m) 1, Price range CHF11.00 CHF Offer price CHF European PE trends Volumes of PEbacked IPOs are at their lowest since Q4 12 Figure 7: Quarterly value and volume of European PE backed IPOs since Q1 Q2 Q4 Q1 Q2 Q4 Q1 Q2 Q4 Q1 Q2 Q4 Q1 Q Value bn IPOs Source: Dealogic and Stock Exchanges 7

8 The sector story Industrials represent the largest sector in 18, supported by the megaipo* of SIG Combibloc Group AG Figure 8: European IPO values by sector By offering value ( m) Q1 18 Q YTD 18 YTD 17 Variance vs YTD 17 Industrials 2,00 1,799 3,9 9,218 (,23) Financials 4,879 3,10 1,21 9,0 3,194,4 Basic Materials Consumer Goods ,09 (3,821) Consumer Services 32 1,439 2,17 4 2,172 Health Care 4, ,80 2,214 2,92 Technology 331 2, , ,12 Telecommunications ,777 (1,7) Oil & Gas ,91 (,41) Utilities ,248 (77) Total 12,480 9,348 3,941 2,79 29,070 (3,301) Industrials 12 IPOs raised 1.8bn in 18 Largest IPO: SIG Combibloc Group 1,708m Financials IPOs raised 1.bn in 18 Largest IPO: Amigo Holdings Plc 407m Basic Materials 3 IPOs raised 173m in 18 Largest IPO: Yellow Cake plc 171m *MegaIPOs are those raising in excess of 1bn Source: Dealogic and Stock Exchanges 8

9 Value of IPOs bn Volume of IPOs UK focus overview Four out of the top five IPOs in Europe listed in London Figure 9: UK IPO trends (by offering value) Figure : UK IPO trends (by volume) bn bn bn bn Q1 Q2 Q4 Q1 Q2 Q4 Q1 Q2 Q4 Q1 Q Main AIM Q1 Q2 Q4 Q1 Q2 Q4 Q1 Q2 Q4 Q1 Q Main AIM Figure 11: Top UK IPOs in 18 Issuer Value ( m) Sector Market PE backed Amigo Holdings Plc 39 Financials Main No Tritax EuroBox plc 300 Financials Main No Trian Investors 1 Ltd 271 Financials Main No Hipgnosis Songs Fund Ltd 2 Financials Main No Yellow Cake plc 11 Basic Materials AIM No Note: Ranking in sterling may be different from ranking in Euros due to exchange rate Figure 12: UK IPO value by sector By offering value m 17 Q4 17 Q1 18 Q Variance vs 17 Financials 1,481 2, ,3 (11) Basic Materials 427 1, (274) Consumer Services (7) Health Care Industrials (199) Technology ,001 2 (7) Oil & Gas (3) Consumer Goods 771 Utilities 441 Total 2,344 4,91 1,277 2,02 1,84 (0) Source: Dealogic and Stock Exchanges 9

10 UK focus relative performance of UK IPOs out of 1 IPOs outperformed the market in 18 Figure 13: Share price performance of UK IPOs relative to the FTSE all share index, from IPO to 28 September 18 (%) 0% 40% % 0% % 40% 0% 80% ASA International Group PLC Immotion Group PLC Yellow Cake PLC Sensyne Health PLC Hipgnosis Songs Fund Ltd TheWorks.co.uk PLC Trackwise Designs PLC Tritax EuroBox PLC companies have outperformed the index Kavango Resources PLC Trian Investors 1 Ltd Puma VCT 13 PLC companies have underperformed the index Ashoka India Equity Investment Trust PLC 2 Nucleus Financial Group PLC Amigo Holdings PLC 9 BigDish PLC Argo Blockchain PLC 2 Main AIM The financial sector dominates once again in London, accounting for over 80% of London values with ASA International Group, the African and Asian focused global microfinance provider, showing the strongest share price performance postipo this quarter. The relative performance of UK IPOs was also encouraging with of the 1 IPOs this quarter outperforming the index, signalling that investors remain confident in those issuers coming to market. With Brexit around the corner and negotiations still ongoing, it is promising to see a number of international issuers in the IPO pipeline, continuing to see London as open for business and a key financial centre in Europe. Lucy Tarleton Director, UK Capital Markets Group at PwC Source: Thomson Reuters as of 28 September 18 Threshold of m proceeds. Relative performance based on the FTSE All Share Index for Main Market listed companies and FTSE AIM All Share index for AIM quoted companies.

11 Value of IPOs bn Volume of IPOs Global perspective Five of the of top ten global IPOs to date are Chinese Telecoms and Technology companies Figure 14: Global IPO activity Q1 Q2 Q4 Q1 Q2 Q4 Q1 Q2 Q4 Q1 Q EMEA bn Americas bn Asia Pacific bn IPOs Figure 1: Top global IPOs YTD 18 Date Issuer Value m Exchange Sector Aug18 China Tower Corp Ltd,398 Hong Kong Telecommunications Jul18 Xiaomi Corp 4,94 Hong Kong Telecommunications Mar18 Siemens Healthineers AG 4,0 Deutsche Börse Health Care Sep18 Meituan Dianping 3,38 Hong Kong Technology Jun18 Foxconn Industrial Internet Co Ltd 3,11 Shanghai Technology May18 AXA Equitable Holdings Inc 2, NYSE Financials Jan18 PagSeguro Digital Ltd 2,128 NYSE Technology Mar18 iqiyi Inc 1,91 NASDAQ Consumer Services Sep18 SIG Combibloc Group AG 1,708 SIX Swiss Exchange Industrials Jul18 Viva Energy Group Ltd 1,84 ASX Oil & Gas Source: Dealogic 11

12 Appendix IPOs by market Appendix 1: European IPOs by market TOTAL 17 Q4 17 Q1 18 Q2 18 IPOs Value m IPOs Value m IPOs Value m IPOs 18 Value m IPOs Value m London Stock Exchange Group 37 3,9 44 9, , , ,043 London Stock Exchange 27 2,72 32,32 1 1, ,84 1 1,899 Borsa Italiana , SIX Swiss Exchange 2 2, ,42 2 1,708 Euronext , , Euronext Paris Euronext Amsterdam Euronext Dublin Euronext Brussels 1 40 Sofia 1 42 Nasdaq Nordic , ,80 21 Nasdaq Stockholm Nasdaq Copenhagen Nasdaq Riga Nasdaq Helsinki Nasdaq Iceland Nasdaq Tallinn Deutsche Börse ,00, BME (Spanish Exchange) Warsaw 9 1, Athens Stock Exchange Oslo ,011 4 Wiener Börse 1 1,80 1 Borsa Istanbul Bucharest Budapest 1 7 Total 7 8, , , , ,941 EUREGULATED SIX Swiss Exchange 2 2, ,42 2 1,708 London Main 12 1,91 1 4, ,28 9 1, , Euronext ,11 8 1, Sofia 1 42 Deutsche Börse Prime and General Standard ,033 4, BME (Spanish Exchange) Main Warsaw Main 2 1, Athens Stock Exchange Wiener Börse 1 1,80 1 Budapest 1 7 Nasdaq Nordic Main , ,39 Borsa Italiana Main , Oslo Børs & Oslo Axess ,011 Bucharest EUregulated subtotal 2,8 0 14,98 30, , ,4 EXCHANGEREGULATED London AIM Borsa Italiana AIM Euronext Alternext Nasdaq Nordic First North Warsaw NewConnect BME Alternative Oslo MTF Borsa Istanbul Deutsche Börse Scale Exchangeregulated subtotal 0 1, , , , Europe total 7 8, , , , ,941 12

13 About IPO Watch Europe IPO Watch Europe surveys all new primary market equity IPOs on Europe s principal stock markets and market segments (including exchanges in Austria, Belgium, Croatia, Denmark, France, Germany, Greece, the Netherlands, Ireland, Italy, Luxembourg, Norway, Poland, Portugal, Romania, Spain, Sweden, Switzerland, Turkey and the UK) on a quarterly basis. Movements between markets on the same exchange are excluded. This survey was conducted between 1 July and 30 September 18 and captures introductions as well as IPOs based on their first trading date. Values include greenshoe. All market data is sourced from Dealogic and the stock markets themselves and has not been independently verified by PricewaterhouseCoopers LLP. 13

14 Contacts Tilly Balwin (Press office) +44 (0) Mark Hughes +44 (0) Lucy Tarleton +44 (0) This publication has been prepared for general guidance on matters of interest only, and does not constitute professional advice. You should not act upon the information contained in this publication without obtaining specific professional advice. No representation or warranty (express or implied) is given as to the accuracy or completeness of the information contained in this publication, and, to the extent permitted by law, PricewaterhouseCoopers LLP, its members, employees and agents do not accept or assume any liability, responsibility or duty of care for any consequences of you or anyone else acting, or refraining to act, in reliance on the information contained in this publication or for any decision based on it. 18 PricewaterhouseCoopers LLP. All rights reserved. In this document, PwC refers to PricewaterhouseCoopers LLP which is a member firm of PricewaterhouseCoopers International Limited, each member firm of which is a separate legal entity.