Italian equity capital markets have found an unlikely lifeline this year in the form of sell-downs in large-listed businesses, but with several of these processes now completed, ECM bankers are looking for their next opportunity.

As of October 2025, follow-on issuance has reached about USD 9.1 bn, up from USD 7.1 bn in 2024 and marking the strongest total since 2017.

Most issuance has centred on repeat placements in large-cap names such as Apollo’s disposal of its remaining stake in Lottomatica or on rare opportunistic equity sales, such as Exor’s sell-down in Ferrari.

This activity, however, has slowed. With Apollo fully exiting Lottomatica earlier this year and few other large-cap sell-downs on the horizon, the deal flow that carried Italian ECM through the first half of 2025 has weakened sharply.

Second-half volumes have been notably poor, according to Dealogic data, leaving bankers searching for the next source of issuance. While 1H 2025 saw USD 8.7bn in follow-on issuance, volumes have dropped sharply to just USD 393.8m in the second half of the year so far.

IPO volumes have provided no panacea. Year to date, IPO proceeds total just USD 92m across 14 deals, almost entirely from smaller Euronext Growth Milan listings such as Markbass, ETS, Dedem and Otofarma. Larger deals remain absent, with the broader IPO market effectively closed for nearly a year.

“The IPO market, at least when it comes to sizable deals, has been effectively shut for almost a year,” one ECM banker said. Teams are focusing on pitching for long-shot situations and maintaining dialogue with issuers.

When looking at lock-up expiry data, the nearest available opportunity might come in the form of Ferrari. Exor’s lock-up expires on 22 February 2026, following the prior sell-down on 27 February 2025. But a 24.4% decline between the offer and current price, alongside Exor’s stated commitment to long-term shareholding at the time, may limit more deals in the name.

The deal had clear benefits for the Agnelli family conglomerate. Proceeds from its sale of a stake in Ferrari, alongside the sale of truck manufacturer Iveco and its defense unit, have contributed to a EUR 4bn war chest for dealmaking, including a major acquisition if a compelling opportunity arises.

IPO drought set to continue

The country’s corporate landscape adds to the challenge. Many family-owned companies remain hesitant to list their businesses amid volatile conditions and a preference to maintain control, while the availability of private capital and debt financing has diverted potential IPO candidates toward alternative funding routes.

An abundance of debt and private money from private equity and family offices has made public equity financing less attractive, another banker said, adding that 2025 could still be remembered as one of the weakest years on record.

Some additional block activity linked to consolidation in the banking sector is still expected, but few market participants foresee a repeat of the early-year momentum.

Convertibles, once a flexible mid-cap funding tool, have also faded amid higher rates and the rising appeal of private credit.

Despite the subdued market, Italy has been enjoying improved international attention.

Prime Minister Giorgia Meloni’s government has prioritised fiscal stability and debt reduction, earning praise from credit agencies and investors.

Large foreign-investment partnerships are also underway, including initiatives with the United Arab Emirates and new collaborations with Africa and the Middle East on energy and infrastructure projects.

Euronext maintains a modest pipeline of smaller listings, with Kaleon targeting a November debut and Vianova and FitActive preparing for listings in 2026. Larger names such as Epta, Cisalfa, Holding Moda and Permira-backed Golden Goose continue to monitor market conditions, as reported.

Further corporate activity could offer interim momentum. Up to 10 Italian, French and US banks are competing to advise EDF on a dual-track process for its EUR 10bn Italian unit Edison, which could result in a minority stake sale or an IPO.

After a record run of sell-downs, Italy’s equity capital markets now hinge on whether a new catalyst can emerge to spur dealmaking against a backdrop that is seeing both improving public optics and stronger investor sentiment.