FT | Wall Street Braces for Private Equity-Led IPO Wave in 2025
- Editor
- Jan 5
- 1 min read
What's New The Financial Times reports investment banks are preparing for a surge of initial public offerings in early 2025, as private equity firms seek to capitalize on strong equity markets and recent interest rate cuts.
Why It Matters This revival marks a potential end to the three-year IPO drought and signals a shift in market appetite toward established, profitable companies rather than speculative growth startups.
Big Picture Drivers
Federal Reserve's three consecutive rate cuts in late 2024 have improved market conditions
Strong stock market gains in 2024 and expected pro-business policies under president-elect Trump
Pressure on private equity firms to return cash to investors after prolonged dealmaking drought
By The Numbers
US listings reached $32 billion in 2024, up 60% from 2023
IPO market peaked at $150 billion during 2021's pandemic boom
S&P 500 has surged approximately 70% from 2022 lows
Key Trends To Watch
Private equity-backed companies like Medline and Genesys leading the IPO pipeline
Fintech giants Klarna and Chime preparing potential $15-20 billion valuations
Nine of ten largest 2024 IPOs traded above listing price by year-end
The Bottom Line While unlikely to match 2021's record levels, 2025's IPO market shows promise with established companies leading the charge and investors favoring profitability over growth potential.
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