There is no doubt Germany has a crowded pipeline of IPO candidates. For the past few months, companies have entertained investors with promising stories, often backed by eager PEs and corporates. It is hard to find anyone looking to launch a deal anytime soon, though.
The USD 416m deal listing of web hosting firm IONOS [ETR:IOS], owned by United Internet [ETR:UTDI], Germany’s only significant IPO this year, was lauded for its stoicism. But a disappointing outcome, fuelled by buyer pushback on pricing, took the syndicate by surprise and hampered any other candidate looking to follow.
Unlike last year, there is no Porsche SE [ETR:P911] driving sentiment; the carmaker saved 2022 at a time when volumes were headed for the lowest tally since 2009. Germany ended an otherwise fallow year with deal volume of USD 9.1bn, according to Dealogic data.
This year’s small crop is a shame, as Germany has proved to be a good runway to the public markets for ambitious corporates, especially in the automotive, tech and telco industries. Germany has seen blockbuster years like 2021, when deal value hit USD 11.5bn coming from 20 deals, as well as the even better 2018, when 18 deals grossed USD 13.5bn, according to Dealogic.
“We are not going to see any post-Easter IPO window in Germany. Issuers have decided not to go for that. The next available period will be June, but it is a question of maybe one, two deals possibly launching,” said an ECM banker.
Oldenburgische Landesbank AG, a German lender backed by Apollo Global Management, was almost ready to pull the trigger, in a listing originally expected to come to market by early May with a valuation of over USD 1.1bn. But the fall from grace of Silicon Valley Bank and the rescue deal between Credit Suisse and UBS made the entire sector less attractive overnight and froze investors who still had positive feedback for the asset, as reported.
Pitching activity is still going strong, and advisers have high hopes around names both old and new.
Schott, the German glass producer, is positioned to float its pharmaceutical packaging business in 2H23. The company is holding investor meetings but management is cagey around windows for the launch, one source familiar with the project said, as well as protective about the valuation they are expecting, which leaves less room to maneuver with buysiders.
“They won’t take unnecessary risks in this market,” said the source.
A spokesperson for Schott said the group does not comment on market rumors and added that, having recently carved out its pharma business into a stand-alone company, the move provides the company with greater strategic flexibility, including for a possible IPO of the pharma business. However, no decisions have been taken at this time, she said.
Advisors’ eyes are still on several companies that had IPO plans in the past and that are seen as likely candidates for a potential comeback. Germany-based pharmaceutical company Stada Arzneimittel has seen inbound interest in an IPO but the PE firms that back the company, Bain and Cinven, are keen to hold on to the asset which has delivered considerable gains on their initial 2017 investment, according to two sources familiar with the situation.
Stada said there is no concrete plan for an IPO; Bain and Cinven declined to comment.
Ottobock, the German prosthetics company, may see EQT, the Swedish investment firm, sell its stake, while a previously mulled IPO option does not seem likely for the time being, said a source familiar, after the plan was postponed last year, according to reports.
Ottobock and EQT did not respond to requests for comment.
Another company that has been on the launchpad for a while, and has become a sort of bellwether of the German ECM pipeline, is Thyssenkrupp [FRA:TKA]’s hydrogen business, Nucera, which has been reported to be targeting the June window for a much-awaited listing.
Everyone seems ready, yet nothing is moving.
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