The management consultancy EY expects ten to twelve IPOs of German companies in 2024. Martin Steinbach, Partner at EY and Head of IPO and Listing Services, attributes the optimism to the backlog of IPOs built up over the years. "Interest rates and the economy are the most important factors that need to be in place. The recent stock rally and the low volatility indicated by the VDax are definitely positive. It's not a question of whether the IPO market will pick up again but when."

In the current year, four IPOs of German companies were among the top 10 in Europe, including Birkenstock with its US listing as the largest German cross-border IPO and one of the ten largest IPOs globally this year. Worldwide, the number of IPOs decreased by 8%, and the volume shrank by one-third.

It is generally projected that the first intentions to float will not be made public until the second quarter of 2024. German candidates for an IPO in the market include the perfumery chain Douglas from the portfolio of the private equity firm CVC, the long-distance bus operator Flix, which is owned by US investor General Atlantic, and Germany's most valuable startup, Celonis.

According to EY's statistics, there were a total of eight new listings of German companies in 2023. Of the five conventional IPOs, four took place in Germany, including Schott Pharma, Thyssenkrupp Nucera, Ionos, and Neon Equity. Birkenstock, however, migrated with its listing to New York. In addition, there were two IPOs via merger with a SPAC (Special Purpose Acquisition Company) – the electric car manufacturer Next.e.GO, which moved to Nasdaq, and the meal kit provider Marley Spoon. Furthermore, the SPAC SMG Technology Acceleration was newly listed in Frankfurt.

Germany has performed well within Europe. The number of IPOs has increased both across Europe and in the US as well. "However, this has not been sufficient to offset the number of delistings", notes EY Partner Steinbach. There are three reasons why companies disappear from the stock exchange: firstly, the takeover of listed companies by competitors or by financial investors who consider the company to be undervalued by the stock exchange. The second is withdrawal from the stock exchange because a company does not need the listing for capital increases or bond issues and therefore wants to save the costs of the listing.

In addition, there is the migration of German and European companies to other stock exchanges. About 7% of all listings are cross-border IPOs. Europe experienced a drain in this regard in 2023. In October, the traditional company Birkenstock debuted in New York with a market capitalization of $8.6 billion. Other examples of emigrants in listings were the Swiss shoemaker On Running, the Swedish oat milk brand Oatly, and the British chip designer Arm. The Irish building materials manufacturer CRH moved its main listing to the US. The German software company Celonis is now also rumored to have plans for a listing in New York.

"There are various factors for choosing a stock exchange," says Steinbach. "There are strategic considerations, for example, when a biotech company wants FDA approval for drugs in the US and sees that as the most important market. Nonetheless, there are hardly any valuation differences anymore – except in biotechnology. The top priority is the preference of the main owner, who may want the stock to be traded in their time zone. Finally, the costs at different stock exchanges also play a role. All these factors are weighed in the decision. Liquidity is certainly not an argument against Frankfurt: the "turnover velocity" – the trading volume of a stock in relation to market capitalization – is very good in Germany compared to international standards.

In 2023, 83 companies were newly listed on European stock exchanges, and companies raised a total of $9.2 billion in IPOs – about 35% more than in the previous year. However, rising interest rates and the weak macroeconomic environment have forced many European companies to put their debut on hold. The armored gearbox manufacturer Renk from the portfolio of the private equity firm Triton and the French software company Planisware canceled their IPOs at the last minute. The private bank OLB and the fuel card provider DKV Mobility did not even dare to publish an intention to float.

In contrast, the IPO issuance volume in the US jumped by 157% to $20.3 billion in 2023. The growing number of candidates for an IPO in the US includes the bakery chain Panera from the JAB Holding of the German billionaire Reimann family. HPS Investment Partners, a private credit provider spun off from J.P. Morgan, has also confidentially filed for a listing. US listing plans are also rumored for the private equity firm General Atlantic. The same applies to the cloud startup Rubrik, that is financed by Microsoft, Kim Kardashian's underwear brand Skims, and the social media company Reddit.