23 Apr, 2025

Tariff-driven market turmoil threatens European IPO recovery in 2025

By Vanya Damyanova and Annie Sabater


Recent market volatility caused by shifts in US trade tariff policies could slow down European IPO activity in 2025.

Global trade tensions clouded the outlook for economic growth and central bank rate cuts, shaking up investor confidence and business sentiment. The heightened uncertainty could lead to further stock market shifts, impeding a previously expected IPO market recovery, experts said.

Smaller listings dominated European IPO activity in the first quarter. The $4.59 billion raised during the period was well below the year-ago $8.13 billion, despite an increase in the number of listings year over year, S&P Global Market Intelligence data shows.

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The largest IPO in Europe during the first quarter featured the $888.1 million listing of Sweden's Asker Healthcare Group AB, Market Intelligence data shows.

Stock price volatility during the quarter prompted some companies to postpone planned stock market debuts. Most notably, German drugmaker Stada Arzneimittel AG, which planned to raise €1.5 billion with a March IPO and be among the first large-ticket listings in Europe in early 2025, delayed its plans due to market volatility, Bloomberg News reported, citing people familiar with the matter.

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"IPO candidates are observing the capital market environment, testing investor sentiment, and adjusting their timelines," Martin Steinbach, EY's IPO leader for Europe, the Middle East, India and Africa (EMEIA), told Market Intelligence. The "equity stories" of companies aiming to go public later in 2025 must be assessed on a case-by-case basis "especially looking at business risks due to tariffs," Steinbach said.

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View pricing and advisory details of Asker Healthcare's IPO.
Learn more about Stada's postponed IPO.

Cautious outlook

In the current environment of high uncertainty and unpredictable markets, the IPO windows are narrowing as stock price instability leads to significant shifts in multiples and valuations, making it "quite challenging to find an attractive and stable bookbuilding range" for future listings, Steinbach said.

Yet, positive factors could drive IPO activity in Europe if markets calm down later this year. A strong IPO pipeline exists with companies ready to take advantage of a more supportive environment, Steinbach said. Furthermore, expected further rate cuts by the European Central Bank, increased government spending, and the easing of some EU regulations would likely support economic growth and businesses in Europe, Steinbach added.

Europe's share in global IPO activity in terms of aggregate transaction value continued to recover in the first three months of 2025 from a slump in the third quarter of 2024, Market Intelligence data shows. Yet, activity remained subdued accounting for the lowest percentage of global IPO transaction value since the fourth quarter of 2023, the data shows.

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The IPO activity in Europe and the wider EMEA region for the rest of 2025 will depend "on the stabilization of equity markets and return of confidence," PwC UK capital markets partner Vhernie Manickavasagar said in the consultancy firm's latest sector report. Macroeconomic stability will be key here as any further macroeconomic shocks or unforeseen geopolitical conflicts are likely to prolong volatility, according to PwC's report.