Shawbrook IPO Set to Spark London Market Revival

Hopes for a revival in London’s IPO market have been reignited by Shawbrook’s formal announcement of its intention to float on the main market of the London Stock Exchange. The specialist lender, which serves the UK’s small business community, has filed documentation to begin a share sale, including a retail offer, potentially valuing the group at up to £2 billion. This move marks one of the most significant flotations in the city for over a year, sending a signal that the long drought in new listings could soon be ending.

Shawbrook plans to offer a minimum of £200 million in shares, with a portion to be newly issued to raise capital supporting expansion, notably through the recent acquisition of small business lender Thincats. The float will also allow private equity backers Pollen Street and BC Partners, and possibly staff, to sell some existing holdings. Reports suggest that the offering would deliver a “free float” of at least 10 per cent of the company’s value, placing it comfortably within reach of the FTSE 250 index for mid-sized UK businesses.

Shawbrook’s board sees London as the natural home for its public debut, being a UK-authorised bank with an entirely domestic customer base. The group’s chief executive, Marcelino Castrillo, outlined ambitious plans to nearly double its loan book to £30 billion by 2030, aiming for annual profits growth in the “mid to high teens” percent range. Since 2011, the bank has completed 24 acquisitions, and its risk management record remains robust, with only £243 million of £37 billion in originated loans written off since 2013.

Signs of wider momentum have emerged, with the cosmetics technology firm Beauty Tech recently listing at a £300 million valuation, and food manufacturer Princes Group said to be planning a £1.5 billion listing later this month. Some companies, including high-profile fintechs, still consider dual or overseas listings. However, observers regard Shawbrook’s step as a litmus test for city appetite. Should it succeed, the IPO is expected to draw both institutional and retail investors, with a parallel retail offering available via the RetailBook platform.

Assistance for new floats may also come from the government, which is considering a stamp duty holiday and tax relief measures to compete with more favourable regimes abroad. Stamp duty currently stands at 0.5 per cent on newly issued and traded shares after a flotation, which is seen as a deterrent for prospective market debutants compared to international exchanges.

Investment bankers, advisers and market watchers are optimistic that a successful Shawbrook IPO could be the catalyst needed for a broader wave of listings, restoring London’s reputation as a leading destination for public capital. Market performance of debutants such as Beauty Tech, which is trading above its issue price, adds to this sense of renewed confidence. The coming months will be closely watched to see if these early signs signal a sustained recovery in the market for initial public offerings in the UK.