LONDON, March 17 Three European equity
associations are uniting to find ways of boosting initial public
offerings (IPOs) in the region, encouraging companies held back
by subdued credit markets to raise funds by other means.
They are setting up a task force that will present its
findings, which will also tackle debt financing, to the EU
executive this autumn.
The Director General of one of the groups, Judith Hart, said
the blueprint would include recommendations to allow some
companies to operate below international financial reporting
standards, and to tailor listing regulations to individual
countries and exchanges.
"In IPO markets, timing is of the essence," said Hart, of
the Federation of European Securities Exchanges (FESE).
"Right now, it's a good moment, but in relative terms, when
you look over 10 years and even 20 years...there has been a
As European banks have reined in lending, new stock market
listings have surged, recovering last year and growing further
so far in 2014 - though they still stand way below the boom
years of the 2000s.
FESE, EuropeanIssuers, and the European Private Equity and
Venture Capital Association (EVCA) said on Monday that the task
force would comprise a mix of around 20 lawyers, corporate
brokers and exchange representatives.
They include Deirdre Somers, Chief Executive of the Irish
Stock Exchange, and management consultant firm Oliver Wyman.
European IPO activity has tripled to $12 billion so far this
year against the same period of 2013, Thomson Reuters data
showed last week.
London IPOs have reached the highest levels seen since 2007,
with 14 issues in the first quarter of this year. But the
corresponding figure seven years ago was 43.
The European recommendations will follow a similar
initiative in the United States that led to the Jumpstart Our
Business Startups Act (JOBS) in 2012.
That legislation eased financial reporting obligations for
small companies and allowed them to test out investor interest
before committing to an IPO.
The European research team will present its findings to the
European Commission in November, following European parliament
elections in June.
The EU is conducting its own research into corporate
finance, with the Commission due to present a "Communication on
the Long-term Financing of the European Economy" this month.
(Reporting by Freya Berry; Editing by John Stonestreet)