(News Bulletin 247) – The number of public offers targeting companies listed on the Paris Stock Exchange increased by 35% in 2024, according to the Alantra France barometer. The low valuation of small and medium-sized Parisian companies may explain this rebound.

If, on the front of IPOs in Paris, the year 2024 was dull, on the public offering side, operations were much more numerous.

Last year, 42 public offers were recorded for companies listed on the Paris Stock Exchange. This is 11 more than in 2023 (31) and almost as many as in 2021 (45), which then constituted a record year in this area, according to the barometer published by the investment bank Alantra, which lists all types of offers (public purchase offer, simplified public purchase offer, public withdrawal offer, public exchange offer, etc.).

In 2023, public offerings had clearly stalled on the Paris Stock Exchange, due to the rise in interest rates and the context of economic and geopolitical uncertainties.

A “cheap” Parisian market

This number of 42 operations in 2024 lists the offers submitted and/or announced. In the end, 39 were actually filed with the Financial Markets Authority. Takeover bids (public purchase offers) and OPAS (simplified public purchase offers) represented 26 in total, or three-quarters, compared to 19 in 2023.

“One of the possible explanations for this increase lies in the level of valuation of listed companies which are rather ‘cheap’ since the CAC40 lost 2.15% in 2024 (the fall in consumption in China and the political crisis have penalized the Paris Stock Exchange)”, argues Alantra.

By typology, the number of simplified public purchase offers (OPAS), filed in 2024, increased slightly compared to 2023, going from 15 to 17 operations. These operations, of a shorter duration, are by nature initiated by a shareholder holding more than 50% of the capital and voting rights.

“This figure is close to that of the good years and once again reveals the importance for an initiator to launch an offer once he has control of the company in order to strengthen his chances of success and to achieve the withdrawal of the listing of the target company”, explains Olivier Guignon, managing partner at Alantra.

Public buyout offers (OPR), which aim to delist the targeted company, have increased significantly to nine operations in 2024, compared to only two in 2023. Share buyback offers (OPRA) which aim to reduce the share capital of the company, are also increasing, with three operations compared to two in 2023.

A high average premium

The initiators of the offers proposed bonuses to shareholders in excess of 30%. The median premium offered to share holders was, in fact, 32% compared to the last stock market price before announcement of the operation, slightly lower than that observed on the public offers of the year 2023 (34.1 %), according to the Alantra methodology.

This stability can be explained by the significant number of offers on companies already controlled (17 OPAS) or specific offers of the OPRA (3) and OPR (9) type, for which it is not necessary to propose a high premium to exit the listing.

This time taking the average and not the median, the average level of premiums rebounded, reaching 43.9% of the target’s “spot” price (level preceding the announcement of the operation), against 36.6%. in 2023.

“The significant increase in the average reveals that certain operations were distinguished by particularly high premiums (generally small companies, historically poorly valued),” argues Alantra.

Moreover, the level of premiums offered by the “top 5” of the highest premiums offered on the basis of the last price before announcement has exploded from one year to the next. It oscillates between 100% (ID Sud) and 250% (Parrot Group) in 2024 compared to 57% to 80% in 2023.

Industrialists still on the move

As in 2023, the vast majority of manufacturers are in charge, since 69% of the offers were launched by these players, while only 12 of the 39 offers submitted in 2024, or 31%, were triggered by financial initiators. The proportion of offers initiated by financial investors is certainly increasing compared to 2023 (26%), but it is almost half as high as in 2022 (50%) and 2021 (49%).

Alantra puts forward an element of explanation, namely financing conditions which, although improving, were less favorable than in 2021 and 2022.

“Issuers are increasingly opting for withdrawal from the Stock Exchange in order to concentrate on long-term strategies far from market pressures,” reported the Herbert Smith Freehills Paris firm in its first half-yearly bulletin dedicated to these operations in October.

Also note the resumption of growth in public offerings on Euronext Growth, a compartment of the Paris Stock Exchange reserved for small capitalizations, less restrictive in terms of regulatory obligations. Thus, 51% of the offers submitted concerned companies listed on Euronext Growth compared to 22% in 2023.

Furthermore, 86% of offers submitted and closed in 2024 led to an effective withdrawal. In 2023, the withdrawal rate was much lower at 75%. This high level of success rate can, according to the investment bank, be explained in particular by the growing number of OPAS and OPRs, offers on which withdrawal of listing is, by definition, more assured.