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Citigroup Sees Renewed Interest in M&A, IPOs

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The EMEA DisrupTech conference in London, convened by Citigroup, reportedly spotlighted the burgeoning environment for mergers and acquisitions (M&A) in 2024.

The event assembled 48 private companies from the EMEA region, including unicorns like BlaBlaCar, EcoVadis and Zilch, to discuss the increasing interest in dealmaking and the resurgence of substantial initial public offerings (IPOs), Bloomberg reported Tuesday (March 19).

Richard Diamond, global head of financial technology for Citi investment banking, noted a “lot of pent-up demand” for M&A among European startups, according to the report. These companies, previously focused on improving operational efficiency and profit margins, now exhibit a renewed optimism and growth eagerness. Valuations have also risen, making people more aggressive in pursuing M&A opportunities.

Yishai Fransis, head of EMEA technology investment banking at Citi, underscored that many companies are shifting their focus from efficiency to growth by “buying and building,” the report said. Buyout firms looking to invest their capital are showing interest in these companies.

Citi bankers are also witnessing the return of big IPOs, per the report. Companies like Swiss skincare company Galderma and German perfume retailer Douglas are contemplating going public. Private markets are also experiencing improved momentum, with UK neo-bank Monzo recently raising 340 million pounds ($432 million) in a funding round.

Mark Tweedie, head of FinTech EMEA at Citi, said that there is definitely an IPO pipeline for FinTech names, and they will access the market when the window opens, according to the report.

Philip Belamant, CEO of British payment app Zilch, said that the stock market rally in S&P and Nasdaq is giving confidence for more M&A and IPOs, per the report.

It was reported Friday (March 14) that Zilch is considering launching an IPO in 2025 and has talked with Nasdaq, the New York Stock Exchange (NYSE) and the London Stock Exchange (LSE) as it works to select a venue.

In February, it was reported that Goldman Sachs said 2024 could mark a recovery for the IPO market, with the current pace of IPOs being completed in the U.S. market being strong enough to exceed the levels in 2022 and 2023, if it continues.