With the FTSE All-Share near all-time highs, and economic recovery slowly beginning to take hold, company managers can command higher valuations for their firms and will be more confident about becoming listed entities.
It takes several months to plan a listing so the deal pipeline will now be filling nicely.
A healthy IPO market is crucial to the long-term functioning of the economy and the financial system. It is a vital route for entrepreneurs to the all-important exit from the firms they have built and helps ensure capital is efficiently allocated.
Companies tend to mature and fade over time or get taken over and delisted, so new blood is necessary to provide pension funds, insurance companies and private investors with places to put their money.
The flotation of Royal Mail is the first in a series of mooted large new issues in the next couple of years. The return of the IPO is much to be welcomed.
Justin Cooper is chief executive officer of Capita Registrars
