Blow for London as We Soda cancels float

The UK stock market took another hit yesterday after what would have been the first blockbuster of the year was called off, blaming an “extremely cautious” investor climate.

WE Soda, a chemical company owned by the Turkish billionaire Ciner family, delisted from the UK stock market two weeks after announcing its intention to go public.

The withdrawal crushes any hope that the listing would trigger a series of IPOs to revive the dormant London market.

And the news comes as new concerns about inflation and interest rates fall prey to investor sentiment.

WE Soda’s initial decision was a much-needed shot in the arm for the city after a slew of companies rejected Britain in favor of private equity ownership or floated to New York.

But last night, chief executive Alasdair Warren said: ‘Since our intention to make the announcement several weeks ago, we have been encouraged by the broad involvement of investors worldwide and the subsequent interest of potential investors in our IPO.

Nevertheless, the reality is that investors, particularly in the UK, remain extremely cautious about the IPO market and this extreme caution on the part of investors in London meant that we were unable to come to a valuation that we believe is our unique reflects financial and operational characteristics.

“That is why we have decided to cancel our IPO on the London Stock Exchange.”

Investors were put off by the rise in government bond yields to 15-year highs as the Bank of England is expected to raise interest rates even further.

WE Soda is headquartered in London, but operates in Turkey and Wyoming, in the US, where it produces natural soda ash used in glass manufacturing, detergents and soaps, plus batteries for electric vehicles.

The Ciner family owns an industrial and media empire under WE Soda parent company Ciner Group, led by 67-year-old billionaire Turgay Ciner, who owns a home in London.

The IPO would have been the largest in the UK since GSK’s split from its consumer health arm Haleon last July.

WE Soda was targeting a valuation of up to £7bn and could enter the FTSE 100 index.

Susannah Streeter, the head of money and markets at Hargreaves Lansdown, said: ‘This is another blow to London, much like confidence in the city when an IPO launch pad appeared to be going up again.

Investors are understandably cautious given the nervousness surrounding the UK’s outlook with inflation still so hot.

It comes after Cambridge chipmaker Arm opted for a multi-billion-pound float in New York, while building materials giant CRH said it would move its stock exchange listing from the UK to the US.

The city’s ministers, regulators and leading figures are pressing ahead with reforms to restore London’s status as a global financial centre.