UK government presses private equity firms to back London IPOs amid listings drought

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UK urges London IPO support

Highlights

UK government officials met private equity firms including Hg Capital, EQT, and Elliott over the past two months to encourage London IPOs amid a listings drought.
Only seven companies have listed in London this year, with potential candidates like EQT-backed IVC Evidensia and CFC being considered for 2025 floats.
The Treasury is debating scrapping the 4.3 billion pound annual stamp duty on shares, as 20 major firms consider moving listings to New York, risking 2 billion pound revenue loss.

Government outreach targets private equity pipeline

As first reported by the Financial Times, Downing Street, the Treasury and Number 10 are holding talks with large private equity and venture capital firms about ways to encourage portfolio companies to list in London.

People close to the situation say firms including Hg Capital, Clayton Dubilier & Rice, General Atlantic, CVC, EQT and Elliott have met ministers and government advisers over the past two months. The discussions come as concern grows that London has not secured a major initial public offering despite measures such as a stamp duty holiday for new listings, director stock options and lower free-float requirements.

Only seven companies have listed in London this year. Potential candidates linked to the firms in the meetings include EQT-backed IVC Evidensia and CFC, which are seen as possible London floats next year, while Elliott-owned Waterstones is still working on a listing and has not decided between London and New York. Hg Capital-backed Visma had also been seen as a possible boost for London's market before volatility in technology stocks interrupted those plans.

The talks are also covering pensions reform, stamp duty and comparisons with markets such as Sweden, where domestic equity investment is stronger. One attendee says the meetings are a positive sign that the government is listening to ideas on how to make the UK more competitive for listings.

Stamp duty debate adds pressure to London market

Officials are also weighing whether broader changes to stamp duty on shares could help prevent more companies from shifting listings to New York. The government has already said it is reviewing the tax, prompting hopes in the City that it could eventually be removed altogether.

Campaigners argue the levy disadvantages investment in British equities because investors do not face the same cost when buying many overseas shares. According to people close to the situation, there is an ongoing dispute inside the Treasury over whether to scrap the tax, which raises 4.3 billion pounds a year, as fears increase that more groups could follow AstraZeneca in seeking a U.S. listing path.

The London Stock Exchange has already given the Treasury a list of 20 companies that could move direct listings to New York, creating an estimated 2 billion pound loss in future stamp duty receipts. The companies seen as more exposed because they have American depositary receipts include Unilever, Smith & Nephew, Shell and London Stock Exchange Group itself.

The pressure comes as takeovers and listing switches threaten the Treasury's longer-term revenue assumptions. While the Office for Budget Responsibility is understood not to have treated the London market exodus as a separate trend yet, the Treasury says there are encouraging signs, pointing to 25.8 billion pounds raised in London since January 2025 through IPOs and follow-on share issuances.

Our earlier coverage of Thames Water’s financial strain detailed the company’s warning of “material uncertainty” over its long-term future, with liquidity limited and a further funding need raising the prospect of special administration. We also noted how the growing political momentum for greater public ownership could turn Thames Water’s situation into an early test of the incoming government’s approach to regulation, intervention and wider sector reform.

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