WE Soda abandons London IPO plans citing ‘extreme investor caution’ in fresh blow to the City
WE Soda abandons plans for London’s IPO, citing ‘extreme investor caution’ as another blow to the city
Chemical producer WE Soda has canceled its forthcoming trade show in London, raising further concerns about the city’s credentials for the IPO.
Last month, WE Soda announced its plans for an IPO, in a deal that would raise the value to between £6 and £7 billion.
It provided a much-needed boost for City after Cambridge chipmaker Arm opted for a US float and CRH’s decision to move its listing to New York.
However, just a week after announcing its plans to go to London, WE Soda announced it had canceled it, citing “extreme investor caution.”
WE Soda has given up on its upcoming IPO in London in yet another blow to the city
Investors, particularly in the UK, remain extremely cautious about the IPO market and this extreme caution among London investors meant we were unable to deliver a valuation that we believe reflects our unique financial and operational characteristics. said CEO Alasdair Warren.
WE Soda is headquartered in London, but the company operates in Turkey and Wyoming, USA, where it produces natural soda ash used in glass manufacturing, detergents and soaps, plus batteries for electric vehicles.
The IPO would have been the largest in the UK since GSK spun off from its consumer health arm Haleon last July.
Susannah Streeter, Hargreaves Lansdown’s head of money and markets, said: ‘This is another blow to London, just as confidence in the city seems to be rising again now that an IPO launch pad.
Investors are understandably cautious given the nervousness surrounding the UK’s outlook as inflation continues to run high.
Gilt yields have risen to levels not seen in 15 years amid expectations that the Bank of England will have to launch new rounds of rate hikes.
“The uncertainty ahead is clearly unpleasant and companies considering an IPO may instead continue to set their sights on New York.”