Posted on Sep 28, 2021 9:25 AMUpdated Sep 28, 2021, 6:02 PM
Exclusive Networks and the Antin fund last week, OVH Cloud and Icade Santé very soon: companies are scrambling to go public. But the side exits also remain numerous. After 17 years of listing, Iliad, the parent company of Free, could well leave the Stock Exchange. This summer, Xavier Niel launched a public takeover bid (OPA) to buy back the 30% of the capital that he did not yet hold. If he succeeds in picking up 90% of the securities (the results of the offer should be known on Wednesday), then he can withdraw his company from the Stock Exchange.
Before Iliad, Baccarat, Natixis, Alès Groupe, PSB Industries
In Paris, Iliad would therefore be the 28e company since January to bid farewell to the stock market. Before her, Baccarat, the specialist in high-end crystal, left the quotation in August. In July, Natixis joined the fold of its parent company, BPCE. Before her, it was Ales Groupe, in receivership, and known for its Phyto and Liérac brands. Another emblematic withdrawal, that of Mediawan. In December, the group behind the series “Ten percent” wanted to strengthen the control of its three leaders Xavier Niel, Matthieu Pigasse and Pierre-Antoine Capton.
For two years, exits have accelerated. In 2020, no less than 37 companies (including Lafuma, the April insurance group, or even Altran acquired by Cap Gemini) left the Paris Stock Exchange. In 2019, they were 20, and only 16 in 2018. Bercy, with the Pacte law of 2019, has indeed facilitated these movements by reducing the holding threshold from 95% to 90% from which a shareholder can initiate a withdrawal. It can “expropriate” the minority shareholders if they reach this threshold, even if the latter contest the price. Last June, the adventure of XPO Europe on the stock market was thus able to end, more than five years after activist Elliott blocked the delisting.
The disaffection with the stock market is not, however, recent. It is a fundamental trend. Since the 2008 financial crisis, the number of listed companies has shrunk by more than 20% worldwide. 2,100 companies were listed on Euronext in 2000 against less than 1,450 recently (before the takeover of the Italian Stock Exchange), according to the Messina institute. Areva, Euro Disney, Radiall, Fimalac, SFR, Zodiac or Euler Hermes have left the rating in recent years.
Small IT and digital values
At the origin of these delisting, redemptions, of course. Recently, small stocks in the IT and digital sectors have been targeted more than others, in particular by investment companies such as Eurazeo. The latter bought the software publisher EasyVista at the end of 2020, before withdrawing it from the Stock Exchange. Anevia, Horizontal Software and Sodifrance have also been released.
Historically low interest rates facilitate the financing of simplified takeover bids and OPRs on a listed company. They also allow the company to borrow very cheaply to finance investments and acquisitions, without necessarily raising funds on the stock market. And then, private equity funds offer abundant liquidity. They are better able to assess the value of a company and advise managers on their development.
Another reason for leaving the stock market: “too many constraints, too costly”, often argue the bosses of SMEs. In addition to the cost, which can prove to be a deterrent, being listed supposes meeting heavy regulatory constraints. You have to be transparent and accept to be subject to market variations.
“The delisting could slow down soon. The stock market attracting again many companies, those which are quoted have less desire to leave it. And then, if some deem the constraints too high, they can transfer their listing to Euronext Growth, a less demanding market, ”explains Vincent Le Sann, Managing Director of Portzamparc. Fleury Michon has opted for such a solution in particular.