European companies are encountering difficulties in their initial public offerings (IPOs) due to geopolitical tensions and ongoing market concerns, according to IPO advisers.

While equity markets are showing signs of recovery, investor caution remains.

This is evident even as the VIX “fear gauge” has decreased by 67% and European stock fund inflows reached high levels earlier this year.

Key factors impacting IPO activity include the Israel-Iran conflict and worries about the performance of newly listed companies. Additionally, companies are facing increased investor demands for lower valuations.

This week, German medical technology firm Brainlab postponed its IPO, citing “geopolitical uncertainties.” Earlier this year, pharmaceutical firm Stada and car parts seller Autodoc also delayed their listings.

Cobalt Holdings, which aimed for a major IPO in London, reportedly could not attract sufficient investor interest.

Meanwhile, companies like Swiss Marketplace Group and prosthetic manufacturer Ottobock are still assessing IPO options but have not finalized their plans.

Funds raised also decreased, from US$14.1 billion to US$5.5 billion, according to Dealogic data.

🔗 Source: Reuters

🧠 Food for thought

1️⃣ European IPO market faces cyclical volatility pattern amidst global tensions

The current wave of postponed European IPOs follows a recognizable historical pattern where geopolitical tensions impact the region’s capital markets.

European IPO volume dropped 24% in the first half of 2025 according to EY data, while Asia showed strong growth during the same period 1.

This regional disparity reflects Europe’s sensitivity to global trade uncertainties, with EMEA proceeds totaling just $5.7 billion from 42 IPOs in Q1 2025 2.

The pattern of companies like Brainlab citing “geopolitical uncertainties” when postponing listings is consistent with previous European IPO market contractions during periods of global tension.

Current market conditions are particularly challenging as they combine geopolitical risks from Middle East conflicts with economic uncertainties from potential trade tariffs.