(Reuters) – The trade war initiated by US President Donald Trump with additional customs duties ranging from 10% to 50%, and its consequences on economic growth as well as global financial markets, have delayed numerous stock exchange projects (IPO) around the world and weighs on mergers and acquisitions (M&A).
The Swedish fintech specializing in fractional payment Klarna and the American neobank Chime has canceled their IPO, according to people close to the files.
The Stobhub ticket dealer, who was to start his presentation tour to investors next week for his already delayed IPO, postponed his projects last Thursday at least a week.
The financial service company ETORO, based in Israel, also postponed presentations to investors for its IPO to Wall Street, initially scheduled for Monday, after April 20 due to market and volatility conditions, a source close to the file reported.
“It will be very difficult to carry out an operation at an end, because the cost of the debt should increase and it will be more difficult to assess companies,” said a experienced banker.
If this trend continues, it could stifle the ability of companies to raise funds and invest, which would further slow down economic growth.
The customs policy has already cooled M&A to Wall Street in the first quarter, the volume of transactions in the United States that has melted by 13% over one year to 436.56 billion dollars, according to DEALOGIC data compiled for Reuters.
“It is not customs duties as such that are problematic,” said Antony Walsh, partner of the law firm Eversheds Sutherland specializing in mergers and business acquisitions. “It is the level of uncertainty that accompanies them that affects the confidence of business leaders”.
At Stubhub, the leaders plan to wait at least a week, even after Easter, before trying a rating to Wall Street, in order to leave the markets to calm down.
(Echo Wang and Milana Vinn reports in New York, Charlie Conchie, Amy-Jo Crowley and Anousha Sakoui in London and Emma-Victoria Farr in Frankfurt; Bertrand de Meyer, edited by Blandine Hénault)
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