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The IPO market in Finland has experienced an unusually long quiet period. However, private equity and venture capital investors have identified numerous companies within their portfolios that they believe have the potential to go public in the coming years. There are indications that once the IPO window opens, many companies will be ready to list on short notice.
The Finnish Venture Capital Association (FVCA) has published a list of Finnish private equity and venture capital-backed companies that, according to their investors, have the potential to go public within the next five years. The list includes a total of 47 companies, nine of which are newcomers to the annually published list.
Most of the companies on the list provide B2B services and products or enterprise software, but the list also includes companies from sectors such as biotechnology, retail, and quantum technology. This diverse group includes both established firms and a few startups.
“What unites the companies on the list is especially their strong growth prospects. Many of them are market leaders in their fields or have tremendous potential for international growth. When asked why these companies are seen as potential IPO candidates, many investors also mention a well-known brand or ecological values, which are appealing to private investors,” comments Anne Horttanainen, Managing Director of the FVCA.
IPO plans on hold
Finland’s IPO market has been frozen for an exceptionally long time. Last year, there were only two listings on the Helsinki Stock Exchange: Mandatum‘s partial demerger from Sampo and the technical listing of Pohjanmaan Arvo Sijoitusosuuskunta on the Nasdaq First North Growth Market. Additionally, Lamor switched from Nasdaq First North Growth Market to the Main Market of the stock exchange.
“Companies’ IPO plans have been on hold for some time both in Finland and globally. However, compared to a year ago, we are seeing activity slightly picking up on Nasdaq Nordic markets. Based on discussions with advisors, many companies in Finland are ready to go public fairly quickly once the markets become more active,” comments Henrik Husman, President of Nasdaq Helsinki.
Private equity and venture capital investors are active owners who develop their portfolio companies during their ownership period and typically exit within 3–7 years. Exits can occur through a sale to another private equity investor, an industrial acquisition, or an IPO, for instance.
Of the companies that have listed on the Helsinki Stock Exchange in the last ten years, about half have had a PE/VC investor background. For example, in the record year of 2021, PE/VC investors listed a total of 17 companies on the Helsinki Stock Exchange.
“As our yearly list shows, there is no shortage of interesting potential IPO candidates. Stabilizing interest and inflation environments and consequently rising valuations are likely to increase companies’ willingness to go public. Private equity investors evaluate IPOs as an exit option as usual, and we hope to see several portfolio companies in the stock market in the coming years,” Horttanainen concludes.
Listed below, in the left column is a potential IPO candidate, and in the right column is the investor who has identified the IPO candidate. The list has been compiled through a survey sent to FVCA’s private equity and venture capital investor members, and it includes portfolio companies that investors could envision going public within the time window of 2024–2028.
Read more about the potential IPO candidates here.
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