Why would you do a US IPO?

We recently compared EUR >50M M&A’s of VC funded EU and US drug developing companies and concluded that a substantial difference exists between the EU and US (https://bit.ly/3uftQmU). Previously we have also looked at EU M&A’s before or after an IPO. Although based on few IPO events, the data indicated that you could improve the multiple if financials were improved by a listing (https://bit.ly/3n0bd3B).

In the figure below we compare the EU and US again, now adding companies that M&A’ed after an IPO. The US data supports our initial hypothesis, that continued financial strength is an important driver of maintaining a substantial return multiple. The data also illustrates the strength of the US public market. In the US 43% of the M&A’s were public companies, compared to 21% in the EU.

In our analysis we operate with location of HQ at the time of the IPO and we have not yet looked at whether “US flip-over” companies mirror the overall M&A multiple benefit of the US market.

Do EU companies that IPO in US – or move to US and IPO – manage to get the same benefits and high multiples?

What do you think? Is it worthwhile for a European company to be listed in the US?

What do you think?
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