Deals Review H1 2024
Capital Markets
Service: Following a challenging few years for the London market, things seem to be looking up. The country has voted for “change” and, as with all new winds, the change in management brings the promise of something new and a much-needed sense of vitality.
According to a recent report in The Times, 37 companies listed on AIM were acquired, many by US private equity firms, in the last year – the highest level of take-private transactions for 12 years – mostly driven by low stock market valuations. A combination of 36 consecutive months of outflows from UK equity funds, low valuations, high interest rates and a poor economic outlook had many companies questioning their reasons for being listed and others reflecting on the attractiveness of an IPO. Despite the apparent rush for the exit door, the London market is resilient and green shoots look to be appearing. Of the 18 New Issues to the AIM (10) and Main Markets (8) that took place in the first half of 2024, PKF were pleased to have supported 6 of them. We were especially proud to have been involved in half of the AIM New Issues in H1 2024.
Immediately following the General Election result, share prices rose in expectation of a prolonged period of stability. The FTSE 250 rose by 1.8 per cent to achieve its highest level for over two years before falling back slightly. Sterling, too, rose 0.1 per cent against the dollar to $1.27 – the highest level since mid-June – and was up 0.01 per cent on the euro at €1.18. Sky News reported that: “On a trade-weighted basis, the pound is now back where it was in 2016.” Companies can start to have a bit more confidence and take steps now that the ground looks to be more solid.
The return to the office after the summer holidays and the run into Autumn promises to be very busy and will be a peak time for the market. With any luck we’re at the beginning of a new and positive cycle on the London markets.