The IPO of conglomerate Puig in Spain is shaping up to be one of the largest European listings of the year. The deal, which could be as large as EUR 3bn, could also kick off the resurgence of the country’s IPO market, which experienced a steep decline in activity last year.

In 2022, Spain had seven IPOs, for just over USD 300m in deal volumes, according to Dealogic data. Last year this fell to just one listing valued at USD 25.15m. IPO and follow-on activity in Spain has remained sluggish in the first three months of the year, with no deals completed thus far (up to 18 April). But the Puig listing could be just the thing to ignite activity.

A healthy pipeline of deals for the rest of the year could follow.

Puig’s IPO, could be followed by Tendam, the Spanish apparel retailer backed by CVC and PAI Partners, possibly before the summer. Tendam is expected to be valued between EUR 2.4bn and EUR 2.7bn.

Meanwhile, Cinven and CPPIB-backed Hotelbeds, the Spanish e-commerce accommodation provider, and Volotea, a Spanish low-cost airline could launch IPOs this year, although the former could be delayed to 2025, according to sources.

The improving sentiment is reigniting hope that dormant candidates will reconsider a launch, with one financial adviser mentioning the examples of Zaragoza-based hydrogen company Calvera and OK Mobility, Spain’s largest car rental company, which has been meeting bankers over the past year to narrow down on its plan.

Previous IPO candidates which could come back include family-owned warehouse manufacturing company Mecalux and Spanish bank Ibercaja.

In addition, ride-hailing firm Cabify shareholders were reportedly working with Morgan Stanley on a listing in the next 12-15 months, though CEO Juan de Antonio told the media the company has ruled out an IPO in the short term.

A sudden burst of activity is fitting for Spain which has historically been a market where activity fluctuates cyclically, one ECM banker said. Spain appeals to investors because it has good growth prospects, innovative businesses, and it is at the forefront of the energy transition, the banker added while also highlighting the liquidity in the country’s stock market is shored up by a strong retail investor presence.

Follow-ons, meanwhile, still form the bulk of activity in Spain, according to Dealogic. While no follow-on deals have been priced this year, last year there were eight trades worth a total of USD 879m.

This was down from the same number of trades in 2022 worth USD 1.53bn, while between 2014 and 2015 deal values topped the USD 20bn mark, with volumes of USD 21.5bn and USD 24bn respectively.

There has also been some Spanish convertible issuance, with one transaction recorded this year valued at USD 108m, while last year the country had three valued at USD 1.2bn.

While opportunities in both the primary and secondary markets in Spain are growing, recent geopolitical volatility could threaten to fizzle out a resurgence.

But at least bankers will feel less like they are tilting at windmills should Puig prove a success.