The London Stock Exchange is on course for a bumper year with £2.1bn already raised in market flotations, it emerged yesterday – the strongest start to a year since the onset of the credit crunch in 2007.
The market has been boosted by a series of retail listings since the start of 2013 with Poundland, Boohoo.com, Pets at Home, McColl’s and AO World going public.
More companies are expected to follow, with the online takeaway food service Just Eat revealing yesterday that it plans to raise £100m of fresh capital when it joins the stock market through a flotation which analysts said could value it between £700m and £900m.
Brit Insurance is also expected to list in London next month and is believed to be considering a price range of between 230p and 275p a share, valuing it at around £1bn.
The most ever raised by initial public offerings in one full calendar year is £28.83bn, in 2006.
Alastair Walmsley, the head of primary markets at the LSE, said: “The surge in retail IPO activity over the last few months can be attributed in part to a reawakening of investor appetite for equity; 2014 looks set to be a strong year for London’s equity market, with a healthy number of UK and international companies seeing the opportunity offered by our markets as a platform for their future growth.”
Just Eat, which handled 40 million meal orders last year, could be valued at more than 50 times its core earnings of £14.1m.
The company could also become the first initial public offering to take advantage of the new “High Growth” segment of the London Stock Exchange, which has been supported by Government as a way to keep new hi-tech companies in this country by allowing them to sell fewer shares to get a listing.
Its chief executive David Buttress, 38, said: “We qualify for both a premium listing or a High Growth one. We will decide nearer the time.”
Just Eat expects to issue a prospectus next month. Mr Buttress would not give details but he and finance director Michael Wroe will become paper millionaires through the float. Private equity backers SM Trust, Index Ventures, Vitruvian Partners, Redpoint Ventures and Greylock Partners will all cash in some shares but also retain stakes.