The future of the UK IPO

IPOs have long played a central role in how most companies go public, but the dominance of classic IPO models in UK markets has been significantly threatened over the last two decades. Companies are ever more reluctant to go public—and those that do so increasingly gravitate towards methods that reformulate or entirely depart from traditional IPO structures. The UK’s exit from the EU on 31 December 2020, which removed the requirement to follow EU regulations, has provided the UK with the opportunity to assess whether its rules still offer the right regulatory regime for IPOs. This paper examines what the right balance for the UK IPO might be. First, it analyses how traditional IPO structures have been evolving in the UK; second, it considers how the development of alternative investment models has been impinging on the classic IPO model; finally, it examines the extent to which new and proposed regulatory changes have learned from these developments in order to strike a satisfactory regulatory balance between issuers and investors. Ultimately, it is argued that the changes to date are modest and stay largely within the confines of existing frameworks, despite the claims that they comprise a fundamental overhaul of the regime. Although some caution is desirable particularly where investor protection concerns arise, the limited nature of these changes means that the reforms to the UK regime may fail to achieve the much-needed revitalisation of the UK IPO.