London IPO activity skyrockets in Q1 2021

IPO Eye An overview of the Stock Exchange listings in Q1 2021 Market overview

A busy start to 2021 for the London markets Main Market AIM Twelve floats Raised: Eight admissions Raised: The witnessed the best start to a year since 2007 with 20 issuers raising £5.6b in the first quarter of 2021, more than half of the £9.4b £5.2b £441m raised in the whole of 2020. The Main Market saw 12 IPOs which raised a combined £5.2b, whilst the Alternative Largest IPO: Largest IPO: Investment Market (AIM) saw eight admissions in the quarter raising £441m. The Dr Martens plc tinyBuild Inc largest Main Market IPO in the period was Dr Martens plc which raised £1.5b, and the largest AIM admission was tinyBuild Inc which raised £154m. Raised: Raised: The performance during the first three months of 2021 is in stark contrast to the same period in 2020 when there were just three IPOs on the Main Market and two £1.5b £154m on AIM, which raised a combined total of £615m — a value nine times lower than this year’s opening quarter. The UK has maintained both its position as the leading listing location in Europe for fund raising and, on a global basis, remains in third place behind the US and China for funds raised via IPO. The markets also had three cross border IPOs in In addition to the extensive IPO activity, the London markets also continued to the quarter including FixPrice, the retailer from the Russian Federation, that raised offer support to existing issuers with over £9b being raised in further offers and £1.2b through the issue of Global depository receipts (GDRs). transactions in the quarter, demonstrating the depth of market available. This represents 25% of total follow-on funds raised in EMEIA in Q1 2021. Confidence in the UK IPO markets as an exit route has been reinforced by the significant Private Equity (PE) activity in the quarter. Three PE-backed IPOs (the same number as in the whole of 2020) were responsible for 41% of funds raised in Q1 2021, including Dr Martens plc as detailed above.

1 IPO markets — historical performance

6000 20 Main Market 1

1 17 5000 16

Main Market — 1 1 1 12 IPOs raised 000 12 12 £5.2b in Q1 12 12 2021. The 11 3000 10

largest by funds No. of IPOs Funds raisedFunds £m raised was 7 2000 6 Dr Martens plc 6

— which raised 5 £1.5b. 1000 3 3 2 2 2

0 0 Q1 Q2 Q3 Q Q1 Q2 Q3 Q Q1 Q2 Q3 Q Q1 Q2 Q3 Q Q1 Q2 Q3 Q Q1

2016 2017 201 201 2020 2021

nds raised £ o. o IPOs

2 IPO markets — historical performance

IPO 1000 1

16 16 16 AIM market 00 16

00 1 AIM — Seven 1 700 AIM admissions 12

600 raised £441m 10 10 in Q1 2021. 500 The largest by No. of IPOs funds raised raisedFunds £m 00 7 7 6 6 was tinyBuild 300 5

5 5 Inc — which raised £154m. 200 3 3 100 2 1 2 2 0 0 0 Q1 Q2 Q3 Q Q1 Q2 Q3 Q Q1 Q2 Q3 Q Q1 Q2 Q3 Q Q1 Q2 Q3 Q Q1

2016 2017 201 201 2020 2021

nds raised £ o. o IPOs

3 Market overview

Market performance 10.00 FTSE 100 The Main Market indices have continued a gradual rise over the quarter, reflecting FTSE 250 both an increase in confidence in the global and UK economy. 130.00 FTSE All-Share The AIM market has continued to trade particularly well, and the market performance FTSE AIM All-Share reflects the share performance of a number of companies that have traded well under 120.00 COVID-19 conditions, including both internet-based enterprises and healthcare and technology businesses. 110.00 Global IPO activity 100.00 Global IPO markets have had the best start to the year in over 20 years with more than $65b being raised in over 300 IPOs. This excludes US-focused Special Purpose Acquisition Company (SPAC) listings which have also been extensive in the quarter 0.00 with around 300 SPACs raising over $90b — compared to some $80b in the whole of 2020. 0.00 NASDAQ was the leading global exchange, hosting 72 IPOs and raising over $24b in the process. US markets combined hosted 99 IPOs and raised $41b with Greater 70.00 China markets hosting a further 133 IPOs raising $29b. Outside of the US, China and the UK, mainland Europe also came alive with 60.00 Amsterdam and Frankfurt posting some of the large IPOs in Q1 2021 helping to propel global IPO activity to its current heights. 50.00 Globally, technology IPOs led again by both numbers and proceeds in Q1 2021, with big technology IPOs driving high valuations and getting a lion’s share of the IPO proceeds. Meanwhile, energy IPOs are making a comeback as one of the better- 01-01-2020 01-02-2020 01-03-2020 01-04-2020 01-05-2020 01-06-2020 01-07-2020 01-08-2020 01-09-2020 01-10-2020 01-11-2020 01-12-2020 01-01-2021 01-02-2021 01-03-2021 01-04-2021 performing sectors, particularly the renewable energy sector.

4 Market listings

New Issues — Main Market Private Country of Market cap. Funds Placing Closing Closing Quarter end % Date of Equity (PE) primary on admission raised price price (after first price at change in price admission Company backed business Sector (£m) (£m) (p) day of trading) QTR end (p) from IPO 29-Jan-21 Dr Martens plc Y Personal Goods 3,700 1,489.0 370.0 450.0 453.0 22% 02-Feb-21 VH Global Sustainable Energy Opportunities plc United Kingdom Equity Investment Instruments 243 243.0 100.0 101.0 99.2 -1% 02-Feb-21 Group plc Y United Kingdom General Retailers 1,200 540.0 350.0 410.0 424.6 21% 09-Feb-21 Foresight Group Holdings Ltd United Kingdom Financials 455 227.0 420.0 460.0 425.0 1%

16-Feb-21 Cordiant Digital Infrastructure Ltd United Kingdom Equity Investment Instruments 370 370.0 100.0 99.0 99.2 -1%

26-Feb-21 plc Y United Kingdom General Retailers 600 300.0 600.0 800.0 820.0 37% 26-Feb-21 Cellular Goods PLC United Kingdom Personal Goods 25 13.0 5.0 19.0 9.6 91% 10-Mar-21 Fix Price Group Ltd Russian Federation General Retailers 5,958 1,248.0 699.9 700.3 708.1 1% 19-Mar-21 Caerus Mineral Resources Plc United Kingdom Mining 5 2.0 10.0 13.0 12.6 26% 22-Mar-21 Roquefort Investments plc United Kingdom Investment Banking and Brokerage Services 2 1.0 5.0 6.8 8.3 65% 23-Mar-21 Group Plc Denmark Technology 1,080 473.0 265.0 265.0 265.0 0% 26-Mar-21 Digital 9 Infrastructure plc United Kingdom Financials 300 300.0 100.0 99.5 99.5 -1%

New Issues — AIM Private Country of Market cap. Funds Placing Closing Closing Quarter end % Date of Equity (PE) primary on admission raised price price (after first price at change in price admission Company backed business Sector (£m) (£m) (p) day of trading) QTR end (p) from IPO

13-Jan-21 Nightcap plc United Kingdom Travel & Leisure 14 4.0 10.0 14.0 27.0 170% 01-Feb-21 Supreme plc United Kingdom Household Goods & Home Construction 156 68.0 134.0 150.0 180.0 34% 02-Mar-21 Virgin Wines UK plc United Kingdom General Retailers 110 48.0 197.0 228.0 225.0 14% 09-Mar-21 tinyBuild Inc United States Leisure Goods 340 154.0 169.0 217.5 227.5 35% 12-Mar-21 AMTE Power Plc United Kingdom Electronic & Electrical Equipment 61 14.0 175.0 233.5 246.0 41% 15-Mar-21 In The Style Group plc United Kingdom General Retailers 105 60.0 200.0 237.0 222.0 11% 29-Mar-21 ActiveOps Ltd United Kingdom Technology 120 75.7 168.0 186.5 190.0 13% 31-Mar-21 Parsley Box Group plc United Kingdom Consumer 84 17.0 200.0 185.0 185.0 -8%

5 Looking forward — 2021

The London markets have sprung back from the initial lockdown and we are Investor sentiment may also be dampened by disappointing 2020 earnings released expecting activity to continue at pace as companies take advantage of the current by companies in sectors that have been more negatively impacted by COVID-19 market window. In the first week of the second quarter, the markets hosted the (e.g., traditional retail, aviation and hospitality) and face the potential of another biggest tech listing on record and more tech listings are slated to follow in the “lost summer”. remainder of the quarter. In response, investors may pause to review their portfolios and rebalance their IPO pipelines remain full and the increase in UK activity, which began in the latter investment allocations among different asset classes. half of 2020, is expected to continue at pace as confidence in the post-pandemic In the meantime, investors will continue to look for investment returns and landscape builds and the UK’s credentials as an international leader hold fast. take advantage of the liquidity and market sentiment, until they see better In terms of sectors, we will continue to see activity from technology and healthcare returns elsewhere. companies together with those that have seen business plans accelerate due to the In terms of sectors, we believe that technology and health care IPOs will continue to pandemic. We may also see the return of more traditional companies although this dominate in the short term with investors remaining receptive to companies in the will depend on the speed of the return of the economy to more normal conditions. right sectors: e-commerce, food delivery, online gaming, cloud solutions and other In order to strengthen the UK’s position as a leading global financial centre, the UK companies that have prospered during the pandemic. government launched the Hill review in Q4 2020. The 15 recommendations from this were published in Q1 and we are starting to see the process begin for the initial rule changes to be put out for consultation, with any implementation likely to take place later in the year. As a result, we are unlikely to see any significant impact on IPOs until the second half of the year, although we understand that the expected changes are already being built into IPO planning for deals scheduled for the latter part of the year. The UK has had the strongest opening quarter for Whilst the UK would likely have to make some significant changes if it were to “IPOs for 14 years, with the markets successfully rival the US, the Hill Review is a positive step forward for the UK’s future in tech. weathering the effects of Brexit and bouncing back Notwithstanding the rule changes, investors will also continue to have a keen eye on issuers’ business models, governance and use of proceeds — all indicating from the stall in activity caused by the onset of that robust preparation is key to a successful IPO. We can also see there is clearly competition to IPOs from US SPACs seeking acquisition targets in the UK which the pandemic a year ago. With an effective vaccine could stand to affect or reshape the market here. rollout underway, momentum and confidence in the Globally UK IPO market should continue to build, but future 2020 has shown us that we can take nothing for granted and uncertainties will growth may vary depending on the sector. continue to weigh in and create market volatility. The potential for a further wave of the pandemic, the speed of vaccination rollouts and efficacy rates and geopolitical Scott McCubbin tension are all ingredients that may trigger a perfect storm. EY UKI IPO Leader 6 Relevant programmes

EY Global IPO Centre of Excellence IPO Retreat Our Global IPO Centre of Excellence is a virtual hub which 16–17 May 2022 provides access to tools and knowledge for every step Looking to float in the next 12–36 months of the journey from finding out more about what going Our IPO Retreat helps CEOs and CFOs contemplating an IPO on one of the public means to considering capital raising options and London markets. It gives unparalleled advice from key advisors and guest speakers who have been through the process, and provides invaluable addressing post-IPO risks. It provides access to all our networking opportunities. The IPO Retreat offers an invaluable opportunity to IPO knowledge, tools, thought leadership and contacts find out whether an IPO is the right growth option for your business. from around the world in one easy-to-use source. To find out more, contact: Aneliya Petrova, [email protected] ey.com/en_gl/ipo

Contacts Scott McCubbin Marcus Bailey For more information about IPO Leader IPO Business Development Leader the IPO Eye and on any IPO — Tel: + 44 20 7951 3519 Tel: + 44 20 7951 1357 related matter please contact: Email: [email protected] Email: [email protected]

Please visit ey.com/uk/IPO for more information on how we can help you on your IPO journey.

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