London’s sweeping new capital markets reforms could finally halt years of decline and spark a resurgence in IPO activity, according to deVere Group.
The independent financial advisory firm believes the regulatory overhaul, rolled out this week, marks a decisive “shift in tone” that could make the City competitive against global rivals like New York after a prolonged period of stagnation.
A historic drought
The analysis comes against a backdrop of bleak performance for the London Stock Exchange (LSE). According to figures cited by deVere, the LSE has endured a historic drought in new listings, with only nine companies listing in the past year.
IPO fundraising hit a three-decade low in 2025, with just £160million raised in the first half of the year. Furthermore, the number of publicly traded companies in London has fallen by approximately 25 per cent over the last decade, underscoring the erosion of the UK’s capital markets ecosystem.
Removing structural barriers
The new reforms, which include the Public Offers and Admissions to Trading regime, replace EU-era prospectus rules. They are designed to simplify capital raising, reduce disclosure burdens, and accelerate deal timelines.
James Green, regional director at deVere Group, argues that these changes address the “regulatory complexity and cost” that have previously driven companies away.
“London is finally sending a signal that it wants to compete again,” Green said. “For several years, companies have cited lower valuations, thinner liquidity, and heavier regulation as reasons to look elsewhere. The direction of travel has changed.”
Green highlighted that changes to rules on prospectuses, follow-on share offerings, and bond issuance would “materially lower friction” for prospective issuers.
Despite the optimism, deVere cautioned that the market should not expect an overnight transformation. Green noted that while policy alignment is a necessary precondition, global macro conditions and interest rates remain influential.
“We don’t expect an immediate surge in IPOs as capital markets typically recover in phases. Confidence returns first, pipelines rebuild next, and execution follows,” Green explained.
He added that closing the valuation gap between London and US markets remains critical: “Regulation alone doesn’t create IPOs, but misaligned regulation can prevent them. London has removed some structural barriers, and that changes the calculus.”
The reforms are also seen as a tool of industrial policy, aimed at anchoring high-growth companies—particularly in AI, fintech, and clean energy—domestically.
“It’s refreshing that London wants to be in the conversation again,” Green concluded. “This is about restoring London’s relevance in global capital formation… The trajectory looks constructive.”
