European ECM Playbook 2025

Market sentiment turned more constructive in 2024, driven by stronger equity performance, particularly in US stocks. Gareth McCartney, global co-head of ECM at UBS, captured the mood, saying: “The surprise, if you like, was actually how well equities performed. Global equities ended up around 20%, which exceeded expectations considering the event risk we had coming into the year.“

According to Dealogic data, total ECM volume across EMEA in 2024 rose by approximately 20% year-on-year to US$156.5 billion, with IPO volume up by 42%. Notably, large-scale block trades accounted for a growing share of issuance, with one senior banker estimating that almost 45% of issuance volume in 2024 was in the sell-down market.

The market’s resurgence was, however, selective. “The market was characterised by a number of large capital raisings (eg National Grid) and accelerated transactions (eg LSEG, Haleon), which saw very strong investor support,” explains Tom Johnson, global co-head of capital markets at Barclays. “The IPO market showed signs of better performance, but aftermarket performance remained mixed and execution quality remains critical.”

You shouldn’t bring a deal unless you know it’s going to work

Andreas Bernstorff, BNP Paribas

Larger, well-understood companies with clear growth narratives – particularly those with private equity backing – led the recovery. Galderma and CVC are frequently cited as examples of high-performing IPOs that helped rebuild investor trust after the disappointing cohort post-Covid. “The definition of mid-cap now is less than €10 billion,” says BNPP’s head of ECM Andreas Bernstorff. “That says a lot about the scale investors are looking for.”

Investors remain highly selective. On their wish list are assets that can demonstrate control over leverage, a path to good aftermarket results, demonstrable growth with a clear customer base and a track record of continued business development.

Carved-out IPOs from listed organisations often tick these boxes, and the market indicated it would welcome more, viewing them as easy-to-understand businesses with strong parent company backing and experienced management. Bringing the ‘right assets’ to market remains crucial.

Leading the pack

A cautious recovery in 2024 saw ECM figures pick up and European banks continue to battle for market share – with deal volume diverging from deal value. Barclays did 29 deals in Europe (excluding MEA) in 2024, around half that of Goldman Sachs’ 58, yet still came in a tight third in the bookrunner rankings with $8 billion in value and a 7.72% market share. JPMorgan topped out the 2024 list at 48 deals with a value of $13.2 billion and a 12.62% market share. Although Wall Street banks retain a strong presence in European ECM, European players are holding their own: with Barclays, BNPP, UBS and Deutsche Bank all putting in strong 2024 performances in the equity space.

One of the most compelling themes early in 2025 was the expected uptick in private equity-backed IPOs and corporate carve-outs. UBS forecasted that sponsors would return with larger, higher-quality assets, driven by maturing portfolios and attractive market valuations.

Dealogic’s Q1 2025 league tables showed BNPP leading in deal numbers (28) and second after Goldman in deal value, followed by Morgan Stanley and JPMorgan. BNPP also topped the IPO bookrunner rankings for 2024, with 10 European listings totalling $1.7 billion.

HSBC’s absence from the rankings, after their decision to exit ECM activity in the UK and Europe, opens competitive headroom for rivals. As BNPP’s Bernstorff comments: “HSBC was never dominant in this space, but their exit does create individual client opportunities.“

Sector diversification is another theme shaping 2025. While technology and growth stocks led the last cycle, 2025’s pipeline includes a broader array of sectors, from industrials and defence to consumer goods. Deals such as the Ageas transaction in Belgium, a defensive raise by an insurer to finance a UK acquisition, have shown strong demand, especially among investors prioritising cash-flow visibility and dividend security, which could boost European share sales even amid tariff uncertainty.

In January, the situation looked almost too good to be true; opening the year into a strong cycle with markets already at all-time highs. But conditions were still precarious – all it needed was one volatility spike to derail momentum.

And that spike arrived, in the form of US president Donald Trump’s ‘Liberation Day’ and its subsequent consequences. The implementation of 20% tariffs on European exports by the US led to substantial volatility, directly impacting investor sentiment and ECM activity. Market valuations faced downward pressure, complicating price forecasting and causing hesitation among investors, particularly regarding long-term commitments such as IPOs, even as news of pauses and potential backtracking by the Trump administration swirl.

The geopolitical tensions contributed to cautious investor behaviour, resulting in postponed IPOs and selective engagement. Although Q1 2025 experienced an overall volume increase of 30% compared with the previous year, driven largely by secondary market transactions, several high-profile IPOs have been delayed. Transactions that proceeded successfully typically had defensive characteristics.

Notably, despite these challenges, European markets saw an influx of US investor participation, indicative of a potential structural diversification away from heavily US-weighted equity allocations. This shift could offer sustained support to European ECM activities if volatility subsides and market conditions stabilise.

Banks such as BNPP, insulated somewhat from US-centric trade tensions, can find opportunities in this changing landscape. The volatility reinforced the necessity for issuers to strategically plan IPO timings and preparedness, emphasising market-readiness to seize fleeting windows of investor confidence.

“The EMEA IPO pipeline was building well, but the recent volatility has impacted the Q2 window significantly, particularly given IPO lead times,” notes Johnson at Barclays. “Expectation is that this pipeline moves out to H2, rather than falls away. Sentiment on IPOs will be very sensitive to the first few transactions performing, but with in-flows improving in the UK and Europe there is every chance that a functioning IPO market opens.”

The first quarter of 2025 reinforced the narrative of recovery and resilience. BNPP led the pack with 29 ECM transactions, more than any other bank, with strong showings in both IPOs and secondary placements. Bernstorff highlighted that these included “deals from corporates, family offices and private equity – all in size“.

Goldman led the value rankings with 19 deals at $6.08 billion in value, closely chased by BNP Paribas and followed by Morgan Stanley and JPMorgan, with Barclays coming in fifth. In terms of IPOs, Citi took the top spot in Europe in the first quarter with four deals at a $399 million value, although BNP Paribas dominated 2024 with 10 deals at $1.7 billion – three more than Goldman, which took the number two IPO spot last year.

The volatile environment forced heightened investor selectivity. Deals with defensive characteristics – such as low leverage; strong, free cash flow; and recurring revenues – performed best.

The participation of US investors in European ECM transactions increased materially. UBS and BNPP both noted a trend of reallocation into Europe among global investors, many of whom had been significantly underweight in the region. This could represent a structural shift in capital flow patterns, particularly if European equities continue to trade at a relative discount to US peers.

2025 has also seen significant levels of accelerated bookbuild activity, with Johnson noting that, as of Q1, volumes were at a two-decade high. “Sellers included sponsors but also long-terms family and/or founder shareholders looking to rebalance portfolios ahead of Liberation Day, for example, the Agnelli family in Ferrari and the Sandoz Family in Novartis,” he says.

Anticipated themes also include the resurgence of industrials, consumer goods and defensive sectors. Deals with strong fundamentals and clear visibility into future earnings are expected to outperform.

As geopolitical uncertainty and market volatility linger, banks will need to demonstrate agility in adapting to these rapidly changing conditions.

Key themes expected to drive ECM volumes in 2025:

• Private equity (PE) exits: The PE community holds significant assets in their portfolios that are well-suited for public markets, and there is pressure from their limited partners (LPs) to monetise these assets outside the PE ecosystem. IPOs and sales to strategic buyers are anticipated to see a real uptick from this source. 
  
• Spin-offs and carve-outs: Pressure on public company CEOs to create value and drive growth is expected to lead to more spin-offs and carve-outs of existing listed companies. The market has shown a willingness to receive carved-out IPOs well. 
  
• Growth companies: Mega trends such as AI and quantum computing are fostering entrepreneurially backed companies that the public market is keen to see list. While the US is expected to lead in terms of concentration around these themes, Europe will also see activity. 
  
• M&A activity: A pickup in M&A activity is anticipated and equity markets are expected to play a role in supporting the financing of these transactions through primary equity raises. European companies looking at relatively low valuations may seek growth through creative M&A, which the equity markets are ready to support.  
  
• Venture capital (VC) deal activity: This reached €16.7 billion in deal value for Q1 2025, mirroring the resilience seen in European public markets. While the deal count was relatively low, this suggests continued private market activity that could potentially feed the ECM pipeline later.  

In a competitive and uncertain environment, banks’ ability to anticipate and meet client expectations is more critical than ever.

First, clients are seeking execution certainty in a market where confidence is fragile. Without confidence, there is no game. Everyone wants the first few IPOs to perform – without that, you cannot bring the rest of the pipeline.

Delivering this certainty of execution requires more than just technical expertise; it necessitates a deep sense of partnership and trust. Clients value clear, honest and direct advice throughout the process. They want their banking partners to be truly invested in the outcome, ideally through a broader, long-term relationship that may have even involved financing the company before IPO considerations arose.

Banks need to educate clients and investors thoroughly and work closely with the company to maximise the chances of success. The development of the cornerstone investor concept in Europe, which was less common previously, is seen as a manifestation of this desire for increased confidence and certainty in delivery.

Our advice is to be strategically ready – don’t time the market, but be prepared to move when windows open

Gareth McCartney, UBS

Second, clients are placing growing emphasis on strategic pre-IPO readiness. McCartney at UBS notes: “Our advice is to be strategically ready – don’t time the market, but be prepared to move when windows open.“ Banks are increasingly helping issuers prepare investor education, governance and ESG disclosures ahead of launch.

This involves preparing the company not just for the listing event itself but for its life as a publicly traded entity. Companies need guidance on demonstrating their value, showing growth with a clear customer base and providing confidence in their ability to deliver consistent performance post-IPO. Preparation for life as a listed company is crucial for aftermarket success.

Third, distribution strength is now a key differentiator. As European issuers consider where to list, banks must demonstrate their ability to reach a global investor base and to structure syndicates that include committed cornerstone investors. A functional priority for every deal team right now should be to lock in the right anchor names.

While in the past the listing location might have been formulaic based on the company’s origin, it is now a more nuanced debate. Perceptions from the 2021 cycle regarding the US market’s liquidity, depth and valuation potential for growth companies are still discussed, though hindsight shows this is not always the case and companies can become less relevant post-IPO excitement. Banks are expected to help clients analyse their strategic objectives and determine the most logical long-term listing location, advising against becoming a ‘subscale, foreign part issue’ in a disadvantageous market.

Fourth, clients want banks to offer candid, data-driven advice on valuation, timing and alternative routes to capital. This includes a willingness to advise against launching deals that are not ready. “You shouldn’t bring a deal unless you know it’s going to work,“ says Bernstorff.

Clients need banks to help them understand the market’s fundamental shifts, such as the significant impact of index investing on demand and valuation dynamics.

Navigating the increasingly multifaceted dialogue between large investors – equity and credit – and corporates directly is another area where banks provide crucial support, helping clients interpret the signals they receive.

The European ECM landscape is competitive, with a recognised hierarchy and ongoing efforts among banks to differentiate and gain strategic advantage.

Goldman and Morgan Stanley are seen as global leaders in ECM during the past decade, typically occupying positions in the top three. Other banks with a significant global presence, such as UBS, Citi, Bank of America, Barclays and Jefferies are now positioning themselves to compete with the top players, while European-centric banks like BNPP also play highly significant roles within the regional context. With HSBC’s departure from European ECM, rivals are now seizing opportunities to consolidate client relationships and win market share.

For banks aiming to challenge the leaders, the opportunity and challenge lie in identifying and leveraging their areas of real strength and growing from there. How are European players doing it?

• UBS claims to have “more access to investors than any other bank globally”.  McCartney attributes this to two factors: a genuinely global and regional equities business with local salespeople reaching a wide range of investors, including smaller and mid-cap focused ones; and, critically, the bank’s wealth management business, which manages trillions in assets and includes a network of global family offices interested in deploying capital into public companies. This combination provides a unique breadth of institutional and private wealth distribution, offering diversity to IPO syndicates that is seen as a compelling pitch, especially in challenging markets. The bank is widely regarded as having strengthened its position post-Credit Suisse acquisition. McCartney emphasises its strategic edge, saying: “We’ve hired top MDs in the US and Europe, and we’re positioned in every major seat now.“ UBS’s ability to deliver US distribution at scale, combined with deep sectoral coverage, makes it a compelling choice for global ECM mandates.
  
• BNPP has emerged as the most prolific underwriter in Europe by deal count, according to Q1 2025 Dealogic data. Its relative insulation from US-China trade dynamics has made it a preferred partner for European and Asian corporates seeking geographic diversification in their banking relationships. “In Asia, especially, clients want to work with banks that aren’t purely US,“ Bernstorff explains. 
  
• Barclays remains strong in sectors such as utilities and infrastructure, having led the landmark National Grid rights issue. Johnson also notes the importance of experienced professionals in a juniorised market, as well as the bank’s reliable and deep balance-sheet capability, a tier-1 distribution platform and a full equity product offering in cash and derivatives. “Few have that combination, but the critical part is delivering it to clients seamlessly and with a solution-orientated mindset, backed up by high-quality advice and execution,” he notes.

Given the concentration of fees in large transactions, being present and winning lead roles on the ‘big deals’ is crucial for market positioning and revenue capture. Investing in the business, scaling up teams – as UBS did post-Credit Suisse integration – and being able to handle both large-scale and smaller, strategic transactions are necessary. The ability to leverage a global footprint for cross-border opportunities, such as European companies looking to list in the US, is also a key differentiator.

A broader relationship that goes beyond just the ECM division is valued by clients and can also be a competitive advantage. Links with areas such as M&A are also important, as banks can support companies raising equity to finance acquisitions.

Ultimately, success in European ECM will likely hinge on banks’ ability to consistently deliver certainty of execution for their clients, provide insightful and trusted advice, build deep long-term relationships and effectively leverage their global reach and unique capabilities to access diverse pools of capital, especially as market dynamics continue to evolve and investor bases change.

Competitive edge is increasingly defined by access to global investors, agility in volatile markets and the ability to deliver differentiated thematic insights. Execution track record also plays a key role – particularly in a period where investor confidence remains a fragile currency.

Banks must adapt their service models to meet elevated expectations. Global investor connectivity, post-deal aftermarket support and sectoral depth are table stakes. More than ever, banks must also bring insight. “Clients want truth, not just optimism,“ say one banker.

With broader macroeconomic and geopolitical uncertainty still looming, ECM success in 2025 will come down to a bank’s ability to build and sustain confidence – among both clients and investors.

Banks successfully navigating 2025 should:

1. Enhance global distribution capabilities: Expand global outreach, especially in the Middle East and Asia, to access new investor pools and ensure deal execution. 
2. Strengthen sector expertise: Deepen knowledge and advisory capabilities in specific high-growth sectors such as technology, industrials and renewable energy. 
3. Leverage digital transformation: Utilise digital platforms and analytics to optimise client interactions, execution efficiency and investor engagement. 
4. Prioritise ESG integration: Embed robust ESG criteria in all offerings, enhancing attractiveness to investors and ensuring compliance with evolving regulations. 
5. Capitalise on M&A synergies: Develop capabilities to support ECM transactions related to strategic M&A, providing seamless advisory and execution services. 
6. Adapt to market volatility: Foster agility in transaction structuring and timing, ensuring readiness to act quickly when favourable market windows open. 
7. Maintain senior advisory teams: Ensure senior leadership actively participates throughout deal lifecycles, providing consistent, experienced guidance to clients. 

Banks must reinforce long-term relationships through sustained strategic dialogue and proactive market insights, positioning themselves as indispensable partners in navigating volatile markets.